The dollar index gained 0.61% to 108.13 points, its highest since July 15, while the euro lost 0.54% to $1.0033, its lowest level since the same date.
The US currency rose 0.61% against its Japanese pair to 136.87 yen, its highest level since July 27. Sterling fell 1.03% to $1.1830, on track for its biggest weekly decline against the dollar since September 2020.
Traders said “the Fed is seen as having more room to raise rates than central banks in other major economies, which are more fragile.” Fed funds futures are pricing in a 54% expectation that the Fed will raise rates by 50 basis points in September and a 46% expectation that the hike will be 75 basis points.
Fed Chairman Jerome Powell will brief the market on his views at the annual Jackson Hole symposium on August 25-27.
The dollar also benefited from safety demand as weak Chinese data and the energy crisis in Europe raise fears of a further economic slowdown, said Jane Foley, head of currency strategy at Rabobank in London.
Source: Ambito
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