Dollar index holds above 101 as markets price 70% October Fed hike odds

  • Dollar index held above 101 on Thursday amid stronger-than-expected US economic data.
  • 70% was the market-implied chance of an October Fed rate hike, up from 55%.
  • S&P Global recorded the fastest US private-sector expansion in more than five years.

The dollar index remained above 101 on Thursday, near its highest level in almost two months, as stronger-than-expected US data increased inflation concerns and bolstered expectations for additional Federal Reserve policy tightening. S&P Global reported that US private-sector activity expanded at its fastest pace in more than five years in September, with both services and manufacturing improving amid greater inflationary pressures. Several Federal Reserve officials reiterated support for last week’s rate increase and cautioned that inflation risks remain persistent. Markets raised the implied probability of an October Fed rate hike to about 70%, from 55% a day earlier. Continued uncertainty over US-Iran negotiations also kept oil prices elevated, adding pressure to inflation expectations.

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Dollar index holds above 101 as markets price 70% October Fed hike odds - CoinPost Terminal