US Dollar Price Forecast: Fed Rate Path Supports Dollar as EUR/USD and GBP/USD Diverge

US Dollar Price Forecast: Fed Rate Path Supports Dollar as EUR/USD and GBP/USD Diverge

Source: EODHD - https://finance.yahoo.com/markets/currencies/articles/us-dollar-price-forecast-fed-064320722.html
Published: Sep 22, 2026 2:43 AM

Dollar Index Outlook: Fed Hike Bets Support Dollar as EUR and GBP Face Diverging Policy Paths The Federal Reserve's hawkish stance on inflation has strengthened the U.S. dollar on Monday as investors expect the central bank to increase interest rates beyond the recent increase. The CME Group's FedWatch tool shows that the chances of a 0.25% hike in the target range for the federal funds rate in October has increased to around 56%, from 43.5% last Wednesday. On Monday, St. Louis Fed President Alberto Musalem said that he expects that inflation will remain above the central bank's target for a prolonged period of time, and that further increases to the policy rate will be appropriate. Accordin...

Market context: This update is relevant to EUR traders, with EURUSD as the primary instrument to monitor for follow-through, trend continuation, or headline volatility.