US Dollar Index Holds Gains Near Eight-Week High on Strong Economic Growth Prospects

The US Dollar Index (DXY) has maintained its gains near an eight-week high of 101.23, driven by strong economic growth prospects and a rebound in oil prices.

On Wednesday, Iran's President Masoud Pezeshkian vowed that the Islamic Republic would not surrender to the US at the United Nations General Assembly, which contributed to a sharp recovery in oil prices.

The release of stronger-than-expected US flash S&P Global Purchasing Managers' Index (PMI) data for September also supported the Dollar's gains. The PMI report showed robust business activity, with output growing at its fastest rate in over five years, according to Chris Williamson, Chief Business Economist at S&PGlobal Market Intelligence.

However, the strong US economic growth has raised concerns about persistent inflation risks and strengthened the Federal Reserve's narrative of higher-for-longer interest rates.