The dollar index firmed up above 98.2 on Monday after jumping in the previous session, supported by hawkish comments from Federal Reserve officials who said last week the central bank needs to take more aggressive steps to combat inflation. St. Louis Fed President James Bullard, who favored a bigger 50 basis point rate increase in the last meeting, said Friday that officials should raise rates to more than 3% this year.
Minneapolis Fed President Neel Kashkari, a former dove, also said he wants to raise rates to 1.75% to 2% this year, according to an essay published on the regional Fed bank’s website. The Fed delivered a quarter-point rate hike last week in an effort to tame 40-year high inflation, and signaled six more rate increases over the course of this year.