Dollar Soars on Inflation Data, Rate Hike Expectations Rise

The US dollar strengthened against major currencies following the release of US PPI data, which showed a surge in inflation to 5.4% year-over-year.

This has heightened market expectations for a Federal Reserve rate hike, with market pricing indicating a 68% probability of a 25-basis-point increase next week and a second hike projected as early as January.

The US Treasury yields rose despite repurchase operations conducted by the US Department of the Treasury, while oil prices accelerated past the $100-per-barrel threshold.