Dollar Holds Firm Ahead of US CPI Data Amid Hawkish Fed Bets

The US Dollar (USD) has held onto its gains above 99.00 ahead of the highly anticipated August Consumer Price Index (CPI) data release.

The USD's rally is largely driven by the stronger-than-expected growth in the United States Producer Price Index (PPI) for August, which accelerated to 5.4% Year-on-Year (YoY) from 4.8% in July.

This outpaced expectations of a 5.3% YoY increase and has prompted hawkish Federal Reserve (Fed) bets, with the odds of an interest rate hike at the policy meeting next week increasing to 72.4% from 61.2% seen before the data release.