Markets price in higher Fed tightening odds after hawkish dot plot, lifting USD while SNB and BoE keep rates steady at June meetings.
The US dollar climbed to its highest level since May 2025, driven by increased bets on Federal Reserve rate hikes following a hawkish dot plot. Gold prices adjusted lower as the tightening bias weighed on risk assets, capping upside momentum.
The Swiss National Bank and Bank of England left key rates unchanged at 0% and 3.75%, respectively, aligning with market expectations. The SNB added “if necessary” to its FX intervention language, though the Swiss franc showed little reaction before weakening after Chairman Schlegel declined to elaborate. The BoE reiterated its readiness to act to meet the 2% inflation target.
UK unemployment data surprised positively, with April’s ILO rate at 4.9% versus 5.0% expected, reinforcing BoE rate hike expectations. Bitcoin’s $61,775 level emerged as a key technical focus amid broader market shifts.