Dollar Climbs to More Than One-Year High

2026-06-18 12:49 By Joana Taborda 1 min. read

The dollar index extended its gains for a second straight session, rising to 100.8 on Thursday and reaching its highest level since May 2025, as investors ramped up bets on Fed rate hikes later this year following a hawkish signal from the Federal Reserve.

The Fed left rates unchanged as expected but signalled growing support for tighter policy later this year.

Around half of FOMC members now project at least one rate increase in 2026, while the central bank also raised its inflation forecasts amid the economic impact of the conflict in the Middle East.

Fed Chair Kevin Warsh declined to provide guidance on the next policy move but stressed that inflation has remained above the 2% target for several years, reaffirming the Fed’s commitment to restoring price stability.

Markets are now fully pricing in a rate hike by October.

The greenback strengthened broadly, with the largest gains seen against the British pound and Swiss franc after both the BoE and the SNB kept rates unchanged.



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