15.09.202601:41:52UTC+00Dollar Extends Gains to Fifth Session

The dollar index climbed above 99.5 on Tuesday, marking its fifth straight session of gains ahead of a widely expected interest rate increase by the Federal Reserve this week. Futures markets are pricing in about a 92% probability that the Fed will raise its benchmark rate by 25 basis points on Wednesday, which would be its first hike in borrowing costs since 2023. Policymakers will also unveil updated economic projections, and investors will be scrutinizing them for clues about the future path of interest rates.

Elsewhere, the Bank of England is widely expected to leave policy unchanged on Thursday, while the Bank of Japan is anticipated to raise rates on Friday. At the same time, higher oil prices are intensifying inflationary pressures, complicating the inflation outlook and strengthening expectations for additional Fed tightening. Cautionary remarks from CEOs of leading technology firms about the potential risks of artificial intelligence have also weighed on equities, increasing safe-haven demand for the dollar.