Dollar posts best week in nine months as rate-hike bets rise

The dollar rose for a fifth straight session on May 15, 2026, posting its strongest weekly gain in more than nine months as hotter U.S. inflation data lifted expectations for future Federal Reserve rate increases and global risk sentiment weakened. The dollar index rose 0.5% to 99.30 in late New York trading and gained 1.4% for the week, its best performance since early August 2025. U.S. April CPI and PPI both topped forecasts, reflecting higher oil prices tied to the Iran war. Kalshi pricing showed the probability of a Fed rate hike by July 2027 rose to 60%. Global bond yields also climbed as investors priced in tighter policy. The U.S. 30-year Treasury yield topped 5%, its highest level since June 2007, while the 10-year yield reached a near one-year high. U.K. and Japanese 30-year yields also hit multidecade or record highs. The rupee remained under pressure, with USD/INR at a record high, while USD/JPY rose about 1.4% for the week.