The market pricing of a hike from the US Federal reserve continues to climb higher, despite mixed bags of data that shows a slowdown in some sections of the economy, while inflation pressure continues to rise. Comments from several policymakers point that anxiety is growing within Fed over the ill effects of keeping monetary policies too accommodative for too long. Speaking last week, San Francisco Fed President John Williams said, “History teaches us that an economy that runs too hot for too long can generate imbalances, potentially leading to excessive inflation, asset market bubbles, and ultimately economic correction and recession”.

Most of the economists surveyed by Bloomberg believe that the Fed would go for a hike this year, probably in December, however, many are not completely counting out November. Recently, the rate hike odds for this year have climbed to 70 percent, the highest level since June and the market is pricing a 20 percent hike odds for November meeting.

The US dollar has benefited from this increase in rate hike bets, while concern surrounding a disorderly Brexit continues to pound the euro and the sterling. The dollar index is currently trading at 98.78, up around 3.5 percent this month.