Dollar Rally Builds as Hawkish Fed Meeting Stokes Rate-Hike Bets

The dollar extended its rally for a second day following a hawkish Federal Reserve meeting, pushing the currency back toward its late-March peak. The strong performance reflects traders' increased confidence that the central bank will begin raising interest rates as soon as late next month. The Fed's messaging has shifted market expectations significantly, with investors positioning themselves ahead of anticipated monetary policy tightening. The dollar's strength reflects broader expectations for higher US interest rates, which typically make dollar-denominated assets more attractive to international investors. The continued momentum in the currency suggests sustained market conviction about the timing and pace of rate increases from the Federal Reserve.