US Dollar Remains Strong After Fed's Hawkish Signal
The US dollar index hovered around 100.6 on Friday (June 19th), holding its highest level since May 2025. This strengthening occurred after investors again increased expectations for interest rate hikes this year, following hawkish signals from the Federal Reserve.
At its Wednesday meeting, the Fed maintained interest rates in line with market expectations. However, investor attention is focused on the central bank's latest projections, where about half of FOMC members now expect at least one rate hike in 2026. This signal has led the market to believe that US monetary policy will remain tight.
The Fed also raised its inflation projections to account for the economic impact of the conflict in the Middle East. Fed Chairman Kevin Warsh did not provide direct guidance on the next policy steps. However, he reiterated the central bank's commitment to restoring price stability and keeping inflation under control.
Meanwhile, an interim peace deal between the United States and Iran took effect on Thursday. The agreement ended a protracted conflict that had disrupted global energy supplies and pushed oil prices down. However, the market remains more focused on the direction of the Fed's policy and the possibility of further monetary tightening, so the US dollar remains strong. (asd)
Source: Newsmaker.id
