The dollar climbed on Monday, positioning itself for its most significant single-day gain since June 17, which marked the first Federal Open Market Committee meeting chaired by Kevin Warsh after his appointment as Fed Chair. The Bloomberg Dollar Spot Index advanced as much as 0.6%, following a largely flat performance on Friday despite a core inflation metric coming in above forecasts.

The 10-year U.S. Treasury yield rose for a fifth consecutive session, breaching the 5% threshold to reach its highest level since 2023. Simultaneously, WTI crude oil maintained its position above the $100 per barrel mark, after touching its highest point intraday since May 19 during the session.

Meera Chandan, co-head of global FX strategy at JPMorgan, noted that the dollar has underperformed in recent weeks, even as elevated energy prices, robust August inflation and non-farm payroll figures, along with Warsh's hawkish signals at Jackson Hole, "should have driven the currency stronger." She added, "For now, we maintain our constructive dollar stance heading into the FOMC meeting, primarily targeting low-yielding currencies like the Swedish krona and the Canadian dollar."

All G-10 currencies declined against the dollar on Monday, with the New Zealand dollar and the Swedish krona leading the losses, both poised for a 1% drop on the day. The yen also weakened, falling over 0.8% to mark its worst performance in a week.