Dollar Hits One-Month High on Growing Hike Expectations

The US dollar is trading at a one-month high as investors weigh the slim but growing chance of a rate hike by the Federal Reserve at its upcoming meeting.

While falling oil prices have eased some concerns over inflation, the greenback remains well-supported due to the lingering possibility of a Fed rate increase.

A 36.3% chance of a 25-basis-point rate hike this week is being factored into market expectations, up from just 16% last week.

Chris Weston, head of research at Pepperstone, noted that 'the lack of meaningful buying at the front end of the Treasury curve has helped keep the US dollar well supported.'