Dollar Strengthens Amid Hawkish Fed Sentiment and Rising Rate Hike Expectations

The US Dollar Index (DXY) is gaining ground for the fourth consecutive day and trading around 101.20 during European hours on Thursday.

This momentum is supported by the Federal Reserve's (Fed) policy outlook, with several officials continuing to support recent rate increases and warning against persistent inflation risks.

The CME FedWatch Tool indicates that market expectations for a 25-basis-point Fed rate hike in October have surged to nearly 69%, up from 55.4% a day ago.

Market participants are now focused on the upcoming US weekly Initial Jobless Claims report, which could further impact the dollar's value.