Dollar Climbs as Fed Hike Bets Fuel Markets Nerves

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On May 14, 2026, the dollar extended its advance as rising Treasury yields and renewed Federal Reserve hike expectations focused currency markets during the Trump-Xi summit.

Dollar Rally Gains Speed

The dollar traded near 98.48 against a basket of currencies, heading for its strongest weekly performance since the Iran conflict began. Investors sharply lifted bets on a December Fed rate hike after U.S. producer prices recorded their biggest rise in four years.

The euro hovered near $1.1717, while the yen weakened despite speculation of fresh Japanese intervention.

Trump-Xi Talks Hold Global Attention

Meanwhile, the Trump-Xi summit added another layer of tension to global markets. China’s offshore yuan climbed to 6.7845, marking an eighth straight daily gain. Investors also tracked the Senate approval of Kevin Warsh as Fed Chair, reinforcing expectations for tighter monetary policy before year-end.