Dollar Rallies as Fed Hikes Interest Rates and Signals Further Increases

The Federal Reserve raised interest rates by 25 basis points and signaled another hike is likely by year-end, making the dollar stronger across the board.

The Fed's decision was widely expected, but the hawkish tone exceeded market expectations, with a strong consensus for another rate increase this year.

The two-year USD swap rate jumped 10-12 basis points, and market pricing for October is now 13 basis points, while December is priced at 32 basis points.