dollar index changed little on Friday and is expected to rise for a record eight months as U.S. data improved and Fed officials spoke to a speech that led to expectations for a rate hike later this year.
USD index will record its longest monthly uptrend since the US dollar fluctuated in 1971. However, the dollar index rose by only about 0.52% in February, the smallest increase in eight months.
USD overcomes earlier month-end selling and the dollar surged on Thursday as more signs that the U.S. economy will expand in the coming months.
"The trend that supports the dollar is still there," said Eric Viloria, foreign exchange strategist at Wells Fargo Securities. The
dollar index once softened from a one-month high that hit Thursday, but remained stable at 95.295 at the end of the trading session.
USD hovered at a nearly month high against the euro, rising 0.08% at $1.1188 at the end of the session. The dollar rose 0.24% against the yen to 119.70 yen.
Euro rebounded from a three-week low against the yen and rose 0.2% at 134.015 yen in late trading.
The U.S. government announced on Friday that the annual growth rate of GDP in the fourth quarter of last year was revised down from an initial valuation of 2.6% to 2.2%, while analysts originally expected it to downward to 2.1%.
In addition to releasing stronger-than-expected GDP data today, the U.S. sales index and consumer confidence data released by the U.S. are also encouraging, but the private index of manufacturing activity in the Midwest unexpectedly fell to its lowest since July 2009, which also made investors somewhat worried about the slowdown in US economic growth.
Against the backdrop of moderate economic expansion, the Federal Reserve has expressed that it will "keep patience" with ending the near-zero interest rate policy. Fed Chairman Yellen reiterated that position this week in a semi-annual Congress testimony.
Other Fed officials have hinted that the Fed is still on the path to normalize monetary policy later this year, but the pace of rate hikes may be gradual as inflation trapped below the Fed's 2% target.
Among other currencies, the Swedish krona rose to a one-month high of 9.3250 kroners against the euro, after data showed that Sweden's economy grew at the fastest pace in more than three years in the fourth quarter last year. Kron's strength complicates the Swedish central bank's efforts to deal with deflation. In the late New York trading, the Swedish Krona fell 0.8% against the euro to 9.3400 kroners.
(USD index time-sharing chart)
