The dollar index steadied above 102 on Monday as investors continued to assess the outlook for US monetary policy ahead of appearances of several Federal Reserve officials this week. Last week, the index tumbled 1.2% after the Fed kept interest rates unchanged, pausing its aggressive tightening campaign when other major lenders were still raising borrowing costs. However, the body hinted at further policy tightening this year, saying in its latest report to Congress that inflation in key parts of the US services industry “remains elevated and has not shown signs of easing.” Markets now expect the Fed to lift rates again by 25 basis points in July and halt afterwards. Meanwhile, the European Central Bank delivered another 25 basis point rate hike on Thursday and signaled more increases. The Bank of England is set to raise rates again this week.
