Dollar rose in European trade on Friday against a basket of major rivals, maintaining gains for the sixth straight day and approaching five-week highs.
The dollar is heading for fresh weekly gains amid continued gains in US yields after strong labor data and bullish remarks by Fed officials, which hurt the odds of interest rate cuts in March 2024.
The Index
The dollar index rose 0.15% to 103.51, with a session-low at 103.29, after closing up 0.1% yesterday, the fifth profit in a row, while hitting a five-week high at 103.69.
Weekly Trades
The index is up 1.05% so far this week, on track for the third weekly profit in a row.
US Yields
US 10-year treasury yields rose 0.7% on Friday, hitting five-week highs at 4.175%, pressuring non-yielding assets.
The developments in the bonds market come amid strong US labor data and bullish remarks from Fed officials.
Strong Data
Recent US data showed retail sales rose past expectations in December, as unemployment claims fell to 11-month lows in a sign of strong conditions.
Fed member Christoper Waller also said on Tuesday that US economic strength gives policymakers flexibility in deciding the timeline of interest rate cuts.
Following the data and remarks, the odds of a Fed 0.25% interest rate cut at the March meeting tumbled from 75% to 55%.
Fresh Data
Now investors await new data on US consumer sentiment and five-year inflation forecasts, with strong results underpinning the dollar and hurting the odds of early interest rate cuts this year by the Federal Reserve.
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