The U.S. dollar started the week on a firmer footing as traders continued to assess the Federal Reserve’s latest interest-rate decision and the possibility of further tightening. The Fed raised its benchmark interest-rate target by 25 basis points to 3.75%–4.00% at its September meeting, keeping monetary policy firmly in focus across global financial markets.

The dollar’s strength has been supported by expectations that U.S. interest rates could remain elevated for longer. The DXY dollar index recently moved above 100, while traders continued to monitor comments from Federal Reserve officials for clues about the central bank’s next moves. Persistent inflation and higher energy prices remain important factors in the policy outlook.

For forex traders, the combination of higher U.S. yields and a stronger dollar could continue to influence major currency pairs. EUR/USD and GBP/USD remain particularly sensitive to differences between U.S. monetary policy and expectations for European and British interest rates.

Attention now turns to upcoming U.S. economic data and speeches from several Fed officials. With markets closely watching inflation and growth signals, any indication of a shift in the Fed’s policy stance could trigger renewed volatility across the dollar, equities and commodities.