Greenback Hits Six-Week High as Investors Anticipate Longer Rate Cycle

The dollar reached a six-week high compared with other currencies as resilient economic data out of the U.S. made the market expect an increase in interest rates.

On Thursday, the data showed that the number of Americans filing for unemployment benefits unexpectedly dropped last week. The latest data showed that the U.S. dollar was up while the other currencies had fallen, such as sterling, which hit a six-week low of $1.1952 on Friday. The euro reached the bottom at $1.0652, the lowest since January 9.

On the other hand, the US dollar hit a six-week high of 104.31 and was on track to its three-week gaining streak.

Tina Teng, a market analyst at CMC Markets, said that, citing the latest data, the U.S. economy is healthy and would not plunge into a recession any time soon.

The report of data at the earlier of this week showed that the U.S. retail sales was in strong growth and the sign of sticky inflation, raising fear that the Federal Reserve would increase the rates higher more than expected before.