The U.S. dollar index (DXY) at the start of Friday's European session held in the 96.20s range that has been inhabited since the start of the week. The greenback briefly slipped on WednesdaY. 

However, then it surged again after the release of the hawkish FOMC meeting minutes. The Market participants are now looking forward to the release of Non-farm Payroll data later tonight.

It comes with the hope that the numbers will continue to support expectations of a faster Fed rate hike. The impact of the release of fomc meeting minutes continues to roll. 

Market participants have now even increased the Fed's projected frequency of rate hikes for 2022 from three times to four times. That is quite unexpected. 

The Rate Hike Probability is 80%

There is a probability of about 80 percent for a "rate hike" of 25 basis points in March 2022. It means the FOMC raised interest rates by the same amount each subsequent quarter.

The situation like that makes the Fed rate would rise from between 0.00-0.25% today to 1.00 percent in early 2023. Speculation around the Fed's policy is also heating up.

That comes with the emergence of quantitative tightening discourse in the minutes. A number of Fed officials also expressed their support for the discourse in their recent public communications.

St. Louis Fed President James Bullard said that the Fed could immediately streamline its balance sheet after starting a rate hike. It must be based on a certain situation.

That condition is if the San Francisco Fed President, Mary Daly, agreed with Bullard. That is though she was previously famous for her dovish views.

The Fed Rate Hike and Quantitative Tightening Scenario 

The four-time "Fed rate hike" scenario plus Quantitative Tightening will be even more seen if the release of Non-farm Payroll data later tonight outperforms expectations. 

Consensus currently expects the Non-farm Payrolls to increase by 400k in December 2021. If the NFP numbers are strong enough, the Fed like getting more fuel to sustain its hawkish rhetoric.

It means that further supports the probability of a March rate hike. That opinion was said by the analysts from NatWest in a note to clients cited by Reuters.

In fact, many things which are happened recently are bringing so many changes in the market. It is not only for the currency, but also for other commodities such as gold, oil, etc.

The Omicron Cases are Increasing

Although the symptoms are not as deadly as the Delta variant, Omicron's rate of transmission proved to be faster. That is why; the amount of the infected people are getting higher. 

According to a New York Times report, the average daily case addition in the United States currently stands at 547,000, more than 2 times the peak of the previous pandemic.

That is also 254% higher than the average amount two weeks ago. The CDC (The Centers for Disease Control and Prevention) estimates that 95% of new cases in the America are Omicron variant infections.

In response to this situation, the United States food and drug regulatory agency earlier this week approved the third dose of Pfizer vaccination and BioNTech for children ages 12-15.

The Price of Gold Is Higher than Before

The prices of gold rallied despite the market putting up a 70% percentage point for a possible Fed rate hike in March. This condition has been predicted by some market participants.

Market interest in safe havens has increased along with a surge in Omicron variant infections and the weakening equity prices. That is written by the TD Securities analysts in a source. Before, the price of this commodity is quite fluctuating. The example is when it was weakening because of the high risk interest.