🇺🇸🇮🇷 The U.S. dollar is heading for its best month since June, and Trump's rejection of Iran's peace deal is giving it another push Oil jumped back above $107 a barrel on the news, feeding fears that inflation will stay high and pushing traders to bet the Fed will RAISE interest
Why now
Thesis: Oil-driven inflation revives Fed hike risk
Catalyst to watch: US-Iran talks and next Fed meeting
Main risk: Hike bets could reverse if oil falls
Why it matters
Dollar strength plus oil above $107 feeds inflation, raising odds of a Fed hike and pressuring risk assets.
Details
🇺🇸🇮🇷 The U.S. dollar is heading for its best month since June, and Trump's rejection of Iran's peace deal is giving it another push Oil jumped back above $107 a barrel on the news, feeding fears that inflation will stay high and pushing traders to bet the Fed will RAISE interest rates, with a 65% chance of a hike next month. Higher rates make the dollar more attractive to hold, and the euro is now on track to lose 2% in September while the British pound sits near a 3-month low. OCBC warns the dollar could climb even further in the short term if the energy crunch drags on and inflation keeps building. All eyes are now on this week's U.S. inflation and jobs data. A stronger dollar is great news for Americans heading abroad, but painful for everyone else, since oil is priced in dollars and every tick higher makes their fuel even more expensive. Source: Reuters / Writer: Julie
Related assets & topics
InflationInterest RatesDollarOilFederal ReserveEnergySources
- x · 2026-09-28 08:40 UTC