Dollar Surges on Rate Hike Fears Amid Falling Oil Prices

The US dollar has reached a one-month high due to lingering expectations of a rate hike at the Federal Reserve's upcoming meeting. Although falling oil prices have eased some inflation worries, traders are still weighing the possibility of a Fed decision to raise interest rates.

The dollar index, which measures the greenback against a basket of currencies including the yen and euro, edged up 0.03% to 101.55. The euro is down 0.01% at $1.1366, while sterling eased 0.02% to $1.3284.

According to Chris Weston, head of research at Pepperstone, 'the lack of meaningful buying at the front end of the Treasury curve has helped keep the U.S. dollar well supported.' Expectations for a rate hike of at least 25 basis points from the Fed at its policy announcement are pegged at 36.3%, up from 16% a week ago.