Dollar Hits New High Before Slipping Back on Japanese Rate Hike

The US Dollar Index (DXY) reached a fresh high of 100.50 before slipping back as Japan raised interest rates to 1.25%, the highest since 1995.

The Bank of Japan's move was seen as a positive for the dollar, but it had little impact on the yen's value, which weakened despite the rate hike.

According to futures markets, there is a 57.6% chance of another Federal Reserve interest rate increase on October 28, which could take the Fed's rate to 4.50-4.75% by mid-2027.