The dollar index held near 98.8 on Wednesday, interrupting its recent decline as higher oil prices fueled inflation concerns and increased expectations for a Federal Reserve rate hike. Oil extended its advance after US forces destroyed five Iranian crude tankers near Kharg Island in retaliation for attempted missile attacks on a US warship. Markets are awaiting key US inflation data this week for additional guidance before next week’s Federal Reserve meeting, with traders pricing roughly a 60% chance of a 25-basis-point increase after stronger-than-expected jobs data released Friday. The European Central Bank and Bank of Japan are also expected to tighten policy this month. The dollar remained under pressure against the yen after Treasury Secretary Scott Bessent cautioned traders against betting on further weakness in the Japanese currency.