Dollar Holds Steady Ahead of Expected Rate Hikes

The dollar is maintaining its recent gains ahead of a Federal Reserve decision, where traders expect the first of several U.S. interest rate hikes.

Currency strategist Carol Kong from the Commonwealth Bank of Australia in Sydney believes that a 25 basis-point increase is about 90% priced, which would give the dollar a modest boost if the Fed increases.

Kong also noted that there's a small chance the dollar could ease if the Fed hikes but Chairman Kevin Warsh downplays the risk of follow-up hikes in the press conference. If the Fed doesn't increase the funds rate, a steep 1%+ fall in the dollar is expected.