© Reuters. Dollar on track for its best weekly rise since November 2016
Investing.com – The dollar jumped to a fresh three-and-a-half month high on Friday after data showed that economic growth in the U.S. slowed less than feared.
At 9:28AM ET (13:28GMT), the , which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose by 0.21% to 91.58, close to session highs of 91.79, its highest level since January 11.
The move came as preliminary data showed that gross domestic product grew 2.3% in the first quarter. Although that marked a slowdown from the prior 2.9%, it marked the best start to a year since 2015 and beat expectations for a slower expansion of just 2.0%.
The dollar was on track for weekly gains of 1.7%, its best performance since November 2016 as higher U.S. Treasury yields and expectations of a more aggressive tightening by the Federal Reserve lent support.
In other pairs with the greenback, fell 1.00% to 1.3779, an eight week low. The pound had already been under pressure after data released earlier on Friday the UK registered an expansion of just 0.1% in the first three months of 2018, missing the forecast 0.3% growth and markedly lower than the 0.4% growth seen in the final three months of 2017.
succumbed to dollar strength and traded down 0.17% to 1.2083. The euro zone also saw first quarter growth in France and Spain slow more than expected in data released Friday just one day after the European Central Bank held steady on monetary policy.
The yen was seeing less downside against the dollar on Friday with slipping just 0.03% to 109.26. That was despite the fact that the Bank of Japan left its monetary stimulus program unchanged on Friday, as expected, but removed previous wording on reaching its 2% inflation around fiscal 2019.
Some analysts suggested that sentiment in the yen received a boost from the news of a historic peace agreement between North and South Korea. In a joint declaration, both leaders confirmed the common goal of realizing, through complete denuclearization, a nuclear-free Korean peninsula and declared that “there will be no more war on the Korean Peninsula and thus a new era of peace has begun”.
Lastly, in another exception to dollar strength, inched down 0.02% to 1.2868.
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