Dollar clings to two-month peak as Fed rate-hike bets mount, yen slides

The US dollar clung to a two-month peak as markets priced in an 83% probability of a Federal Reserve rate hike in December, with nearly half of policymakers now expecting a hike this year amid rising inflation concerns. Risk appetite weakened on fresh Gulf uncertainties, with Trump warning of potential renewed attacks on Iran, keeping oil prices elevated. The yen weakened toward 160 per dollar, a level often seen as a threshold for official intervention, while the BoE is expected to keep rates steady at 3.75%.