Dollar elevated as sticky inflation cements Fed hike bets, debt ceiling deal lifts optimism

The US dollar strengthened as its economy proved resilient, leading to increased market expectations for further rate hikes by the Federal Reserve and higher US Treasury yields. The greenback reached a fresh six-month high against the yen and was on track for a monthly gain of over 3% against the Japanese currency. News that a debt ceiling deal had been reached added to the risk-on sentiment. Against a basket of currencies, the US dollar rose slightly from Friday’s level to 104.29. The Turkish lira remained under pressure and hit a record low of 20.06 per dollar.