The dollar surged to its highest level since November, lifting the Bloomberg Dollar Spot Index 0.4% as traders doubled down on Federal Reserve rate‑hike expectations. Market pricing now reflects two quarter‑point hikes by 2027, a shift that widens the yield gap with most other central banks. $1.00 per euro fell to a one‑year low, underscoring the move and pushes the greenback toward historic strength.

Mizuho strategist Jordan Rochester warned the dollar could climb further, noting its tendency to rally ahead of Fed tightening cycles. Meanwhile, European Central Bank head Christine Lagarde’s comments curbed rate‑hike bets, pulling the euro down, while the yen stayed under pressure as the Bank of Japan appears reluctant to raise rates fast enough to curb weakness.

The index is up 1.7% year‑to‑date, buoyed by its safe‑haven appeal and a spike in oil prices after the U.S. and Israel struck Iran in February. Although a recent U.S.–Iran accord eased energy‑price pressure, lingering inflation concerns keep markets anchored to the view that the Fed will keep tightening to tame cost growth for global investors in the near term.