Dollar near two-week high as oil surge lifts yields, Fed hike bets

The euro was pinned at one-month lows against a broadly strengthening dollar on Tuesday, as surging oil ​prices lifted Treasury yields and ​reinforced expectations that the Federal Reserve ​will hike interest rates this week.

Benchmark U.S. 10-year Treasury yields surged to their highest since 2007, climbing 7.2 basis points on the day to 5.03%.

Oil prices held near a four-month peak, standing at $107.7 a barrel, after Yemen's Iran-aligned Houthis launched a new wave ⁠of attacks ‌on Saudi Arabia and Gulf-Iran talks were postponed.

Markets now see a ⁠Fed hike on Wednesday as a near certainty, with CME's FedWatch tool pricing in a more than 94% chance of an interest-rate increase.