Analysis: If the Federal Reserve cancels its forecast for rate cuts in 2026, the US dollar may rise.

Francesco Pesole of the Netherlands International Group stated in a report that if the "dot plot" predictions released by the Federal Reserve on Wednesday show that the bank no longer expects to cut interest rates in 2026 due to rising energy prices, the US dollar may rise. The Federal Reserve's prediction in December last year suggested a rate cut in 2026. He said, "If the prediction is adjusted to no rate cut in 2026, the US dollar should benefit." "The risk obviously lies in a hawkish correction." Pesole said, however, the dollar's reaction may only be temporary, as the market focus will quickly return to the situation in the Middle East. Data from the London Stock Exchange Group shows that expectations in the US currency market currently reflect a 20.9 basis point rate cut this year. The DXY dollar index rose 0.3% to 99.87. The Federal Reserve will announce a decision at 1800 Greenwich Mean Time.