Dollar gains, Wall Street retreats as investors brace for Fed hikes

The prospect of faster or larger US interest rate hikes helped push the dollar to its highest levels since July 2020.

U.S. stocks retreated on Thursday after a solid opening, while the dollar gained as investors prepared for future rate hikes from the Federal Reserve.

All three major U.S. stock indexes ended lower, having been whipsawed by uncertainty in recent days, marked by wide fluctuations and heightened volatility. The Dow Jones Industrial Average 0.02%, the S&P 500 lost 0.54% and the Nasdaq Composite fell 1.4%. The MSCI world equity index, which tracks shares in 45 nations, fell 0.94%.

Markets opened higher as new data showed the U.S. economy accelerated in the fourth quarter, growing 6.9% - the fastest rate since 1984. But, as