US dollar climbs on Fed rate hike expectations
TLT•The US dollar climbed as markets priced in possible back-to-back Federal Reserve rate hikes over the next three months, with Tuesday’s hotter-than-forecast inflation data reinforcing expectations of rapid tightening.
1. Dollar gains
The US dollar climbed as markets priced in possible back-to-back Federal Reserve interest rate hikes over the next three months. Tuesday’s hotter-than-forecast inflation data reinforced expectations of rapid Fed tightening, while the euro weakened and French borrowing costs rose, renewing fears of a bond crisis.
2. Other currencies
Sterling showed little reaction to UK GDP growth accelerating to 0.7% in the third quarter, as expected. The Canadian dollar edged higher late in the session as oil prices rose.
