US inflation expectations, as measured by the 10-year breakeven inflation rate per the St. Louis Federal Reserve (FRED) data, jump to the fresh high since October 27 by the end of Monday’s North American trading.

In doing so, the risk barometer extends the previous week’s rebound from the lowest levels since October 12 to flash 2.62%, per the official website data.

It’s worth noting that the jump in the US inflation expectations has been the key catalyst that pushes the Federal Reserve (Fed) policymakers towards rate lift-off. Recently, Charles L. Evans, the chief executive officer of the Federal Reserve Bank of Chicago said, “If inflation expectations increase a lot, it would make sense to think about a 2022 rate hike, per Reuters.

While the tapering tantrums underpin the US dollar strength, President Joe Biden’s stimulus and anxiety over the Fed reshuffle in 2022 seems to weigh on the greenback of late. The same highlights Tuesday’s speech from Fed Chairman Jerome Powell as the day’s crucial event to forecast market moves.

Read: AUD/USD stays firmer above 0.7400 amid softer USD, upbeat sentiment