Key facts
- The US dollar reached a near two-month high on Wednesday, September 23, 2026.
- Markets are anticipating further interest rate hikes from the US Federal Reserve.
- The euro fell 0.37% to US$1.1405.
- Sterling fell 0.5% to US$1.3273.
- The dollar index rose 0.36% to 100.92.
- Brent crude futures rose 1% to over US$100 a barrel.
The US dollar strengthened to a near two-month high on Wednesday, September 23, 2026, as markets priced in the likelihood of further interest rate hikes by the Federal Reserve. This hawkish stance from the Fed has become a dominant factor in currency markets.
The euro fell to its lowest level since late July, declining 0.37% to US$1.1405, while sterling dropped 0.5% to US$1.3273, its weakest point since early July. The dollar index, a measure of the greenback against a basket of six major currencies, gained 0.36% to 100.92.
Oil prices remained a key focus, with Brent crude futures rising 1% to over US$100 a barrel. This increase occurred despite hopes that diplomatic efforts might resolve the ongoing Middle East conflict. While crude oil prices have moderated from their peaks, refined product prices, particularly for diesel, remain elevated, reaching record highs in the US and multi-year highs in Europe. US President Donald Trump indicated support for a diesel export ban to lower domestic prices, a move analysts suggest could negatively impact global supply.
Investors are also awaiting a meeting between President Trump and Chinese President Xi Jinping to discuss the strained US-China relationship.
The Japanese yen weakened to 158 per dollar, with traders cautious about potential intervention following the Bank of Japan's recent rate hike, which failed to fully reassure investors about future tightening.
ING strategist Francesco Pesole noted that the Fed's narrative is strong enough to sustain demand for the US dollar, and that oil prices around the US$90 to US$100 range are unlikely to prompt a dovish shift in market expectations regarding Fed policy.