Ahead of the Fed: Dollar at Nearly 4-Month High, Surges Above 3.08 Shekels

The dollar surges above 3.08 shekels, a high since April 9, ahead of the Fed's interest rate decision this evening. The euro is trading at 3.50 shekels. Markets expect the Fed to keep rates unchanged, but Fed Chair Kevin Warsh may surprise with a hike due to inflation pressures from the war in Iran and AI bottlenecks.

The dollar surges above 3.08 shekels, a high since April 9, ahead of the Fed's interest rate decision this evening. The euro is trading at 3.50 shekels, compared to a representative rate of 3.483 shekels. Markets expect the US central bank to keep rates unchanged, but Fed Chair Kevin Warsh may surprise with a hike due to inflation pressures from the war in Iran and AI bottlenecks. Warsh has made clear he wants to return the central bank to an era of less predictable communication. At the Fed's June meeting, half of the committee members estimated that a rate hike would be needed this year. Economists estimate that a rate hike would help Warsh prove seriousness in fighting inflation, but could surprise markets and cause volatility.