The US Dollar Index (DXY) trades near 101.9 in early October 2026 after climbing roughly 4% over the past year, driven primarily by the Federal Reserve’s September 25-basis-point hike to a 3.75–4.00% target range and subsequent hawkish communications signaling additional tightening. Resilient US growth, firm consumer spending, and rising Treasury yields have reinforced rate differentials versus major trading partners, supporting the dollar even as core PCE inflation showed some moderation. Traders are monitoring upcoming September nonfarm payrolls, CPI releases, and the late-October FOMC meeting for signals on whether the higher-for-longer policy path persists or eases, with implied probabilities reflecting ongoing uncertainty around the pace of further adjustments.