Dollar holds near multi-week highs as markets await Fed decision
The US Dollar remained firm on September 15 as traders positioned for the Federal Reserve's rate decision, with a widely expected hike already reflected in markets.
The US Dollar traded near a two-week high on Tuesday as traders awaited the Federal Reserve's policy decision. Higher Treasury yields and expectations of a US rate hike supported the greenback.
Reuters reported that markets were pricing a very high probability of a 25-basis-point Fed increase. The dollar's next move could depend heavily on the Fed's updated projections and guidance on future rates.
Oil prices near four-month highs pushed Treasury yields higher and added to inflation concerns, keeping the dollar sensitive to both energy markets and the Fed's policy outlook.
Forex traders are watching the Fed decision and press conference for changes in rate expectations that could influence major pairs including EUR/USD and USD/JPY.
Key Takeaways
- Dollar remained near a two-week high on September 15.
- Markets were pricing a high probability of a 25-basis-point Fed hike.
- Higher oil prices and Treasury yields supported the dollar.
- Fed guidance could drive the next major move in major currency pairs.
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