The US Dollar Index (DXY) holds firm near a two-week high on Tuesday as traders prepare for the Federal Reserve’s (Fed) monetary policy decision on Wednesday. At the time of writing, the index trades around 99.66, up 0.17% on the day.

The Dow Jones Industrial Average trades just under 52,000, down around 450 points, a day before the Fed's first expected hike since July 2023. Bets in the futures market put the odds of a quarter-point at 92.5%, so Wednesday's vote is not the news.

TD Securities’ macro team, including Oscar Munoz and colleagues, expects the FOMC to deliver a 25bps hike, with the dot plot signaling fewer hikes than markets imply.

The US Dollar (USD) outperforms its major currency peers on Tuesday, following strong United States (US) Treasury Yields on expectations that the Federal Reserve (Fed) will remain on the monetary tightening path even after hiking interest rates at the policy meeting on Wednesday.

OCBC strategist Christopher Wong notes the US Dollar Index (DXY) around 99.5, supported by higher Oil, elevated UST yields and softer risk sentiment. He highlights tentative bullish daily momentum and two-way risks, with resistance near 99.80–100.30 and support around 99.30–98.00.

Dow Jones futures fall by 0.56% to trade near 52,150 during European hours on Tuesday. Meanwhile, S&P 500 futures decline by 0.42% to trade around 7,590, while Nasdaq 100 futures drop by 0.37% to trade near 29,050.

MUFG’s Lee Hardman notes the US Dollar (USD) has strengthened ahead of the FOMC meeting as Fed tightening expectations are repriced higher. The US Dollar Index (DXY) has recovered to levels seen before the August Treasury buyback announcement, with US yields rising sharply.

The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, maintains a positive bias for the fourth straight day on Tuesday and climbs back closer to a nearly two-week high, which it touched the previous day.

The US Dollar Index (DXY), an index of the value of the US Dollar (USD) measured against a basket of six world currencies, currently trades near 99.60 in the Asian trading hours on Tuesday. The DXY edges higher on expectations of a US Federal Reserve (Fed) interest rate hike on Wednesday. 

The US Dollar Index (DXY) held firm at the start of the week, staying above the 99.00 mark and trading near 99.40, still short of the 100.00 threshold.

Scotiabank strategists Shaun Osborne and Eric Theoret note the US Dollar (USD) is firm at the start of FOMC week as swaps now price an 85% chance of tightening on Wednesday.

The Dollar Index trades near 99.50, up 0.4% on the day, and it made the whole of that gain while America was asleep. A 5% Treasury yield sounds like the best thing that could happen to the Dollar, and New York has spent the morning selling it.

The Dow Jones Industrial Average is down around 200 points and trades just under 52,400, and the reason is less exciting than the headlines. Those are about artificial intelligence (AI) and a sell-off in chip stocks, and that story belongs to the Nasdaq Composite, down about 1%.

MUFG’s Lee Hardman notes that the US Dollar (USD) has strengthened only modestly even as markets price in a Fed rate hike at this week’s FOMC meeting.

Commerzbank’s Thu Lan Nguyen notes that stronger-than-expected core US inflation has pushed market pricing toward a near-certain Federal Reserve rate hike this week and higher odds of another move by year-end.

Dow Jones futures decline by 0.17% to trade near 52,500 during European hours on Monday. Meanwhile, S&P 500 futures fall by 0.64% to trade around 7,610, while Nasdaq 100 futures experienced a sharper drop of 1.46% to trade near 28,960.

OCBC strategist Christopher Wong notes that firmer United States (US) Consumer Price Index (CPI) and a near-90% chance of a September Fed hike have not translated into lasting Dollar strength, with US Dollar Index (DXY) stuck around 99.1.

The US Dollar (USD) starts the Federal Reserve’s (Fed) monetary policy week on a strong note, which is scheduled for Wednesday. In the European trading session, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, trades 0.37% higher to near 99.46.

The US Dollar Index (DXY) reverses earlier gains on Friday as a pullback in longer-dated US Treasury yields outweighs support from the latest US Consumer Price Index (CPI) report, which strengthened expectations that the Federal Reserve (Fed) will raise interest rates next week.

The Dow Jones Industrial Average trades just beneath 52,600, roughly 510 points higher, after four sessions of losses. The inflation print was worth about 100 points at 12:30 GMT, and the rest of the advance arrived in the afternoon once the long end of the Treasury curve turned.

ING’s Francesco Pesole notes that the Dollar is benefiting as global bond yields and Oil prices rise, with the USD re-establishing a positive correlation with long-end US yields.

Brown Brothers Harriman’s (BBH) Elias Haddad notes the US Dollar (USD) is supported by recent risk aversion and a modestly hawkish Federal Reserve (Fed) repricing after US August Producer Price Index (PPI), but stresses that August Consumer Price Index (CPI) will be decisive for next week’s Fed meet

MUFG’s Lee Hardman highlights that the stronger United States (US) Producer Price Index (PPI) data has reinforced expectations for a Federal Reserve (Fed) rate hike, with around 18 bps now priced for next week’s FOMC meeting.

The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, sticks to a mildly positive bias through the early European session, though it remains confined within the previous day's broader range.

Dow Jones futures advance by 0.46% to trade near 52,350 during European hours on Friday. Meanwhile, S&P 500 futures gain by 0.44% to trade around 7,630, while Nasdaq 100 futures inch lower by 0.45% to trade near 29,260.

The US Dollar (USD) clings to its Thursday gains in early session on Friday, driven by faster-than-expected growth in the United States (US) Producer Price Index (PPI) data for August.

The US Dollar (USD) claws back its early losses and turns positive ahead of the United States (US) Producer Price Index (PPI) data for August, which will be published at 12:30 GMT.

Brown Brothers Harriman (BBH) Elias Haddad highlights that the US Dollar Index (DXY) is trading just above recent lows and below its 200-day moving average, with the upcoming United States (US) August Consumer Price Index (CPI) seen as the key driver for the Federal Reserve’s (Fed) September 16 deci

MUFG’s Lee Hardman notes that the US Dollar has softened over summer as the US Treasury’s announcement to at least double long-term bond buybacks undermined confidence while inflation risks rise.

Dow Jones futures advance by 0.36% to trade above 52,600 during European hours on Thursday. Meanwhile, S&P 500 futures gain by 0.22% to trade above 7,650, while Nasdaq 100 futures inch lower by 0.04% to trade near 29,430.