Markets price 90 chance of 75bp Fed hike this week
Dollar index hits 20year peak above 105
Yen wallows as BOJ piles in to bond market

SINGAPORE, June 14 Reuters The U.S. dollar stood just below a 20year peak on Tuesday and just about everything else nursed losses as investors braced for aggressive Federal Reserve rate hikes and a possible recession.

Markets have scrambled to bet on rapidfire hikes in the wake of an unexpectedly hot inflation reading on Friday. Consecutive 75 basis point rate rises in June and July are close to fully priced, sending shockwaves across asset classes.

The dollar has gained with yields and as investors seek shelter from the storm. The dollar index scaled a twodecade peak of 105.29 on Monday and held near that level in Asia.

It has hit onemonth highs on the euro, Australian dollar, New Zealand dollar, Swiss franc and Canadian dollar and it made a fresh onemonth top of 1.0397 per euro on Tuesday, before retreating slightly to 1.0438.

Sterling scraped from a twoyear low to 1.2180, but is weighed down as the Fed is seen outpacing the Bank of England, which is expected to deliver a 25 bp hike on Thursday.

Even the Norwegian crown , which has been supported by firm oil prices and a central bank that began hiking last year, touched a twoyear low of 9.9295 per dollar in Asia.

The dollar seems to be the stagflation hedge of choice, said Bank of Singapore strategist Moh Siong Sim.

The market is starting to turn a lot more fearful, he said….