Dollar Rises on Rate Hike Speculation and Falling Oil Prices

The US dollar has hit its highest level in a month, driven by speculation over a potential rate hike from the Federal Reserve. The dollar index rose to 101.55, with the euro down 0.01% at $1.1366 and sterling easing 0.02% to $1.3284.

A growing number of major brokerages believe there is a real risk of the Fed delivering a rate hike this week, given the surge in oil prices during the month and the escalation in tensions in the Middle East.

Expectations for a rate hike of at least 25 basis points from the Fed at its policy announcement are pegged at 36.3%, according to CME FedWatch, up from 16% a week ago.