The dollar held near a 19-month high on Friday after a strong week of gains on rising bets of a larger Federal Reserve rate hike, pushing the Japanese yen back near the key 160 mark that has left traders on alert for intervention.
Noriko Hayashi | Bloomberg | Getty Images
The dollar saw its strongest weekly rise since September on Friday, holding near a 19-month high as rising bets on a larger Federal Reserve rate hike lifted U.S. Treasury yields, while the yen hovered around 160 per dollar and kept traders alert for possible intervention from Tokyo.
Hawkish comments from Federal Reserve officials and this week’s stronger-than-expected US inflation data have left traders weighing the prospect of a larger-than-usual Fed rate hike next month.
The euro was down 0.25% at $1.1025, after hitting its lowest level against the dollar since April 2025. It was on course for its fourth straight week of losses.
The dollar was up 0.44% at 0.839 against the Swiss franc and snapped two straight weeks of losses.
“The dollar is still firm and that’s driven by a robust jobs report and an acceleration of the CPI,” said Marc Chandler, chief market strategist at Bannockburn Global Forex. “We’ve had a series of hawkish comments from Fed officials this week including from (New York Fed President John) Williams and (Fed Governor Christopher) Waller.”
Traders are pricing in a roughly 90% chance of a 25-basis-point hike next month, the CME FedWatch tool showed.
The dollar index, which measures the greenback against a basket of currencies, was up 0.2% at 103.379, clinging to its highest since April 2025 and notching its biggest weekly gain since September. The greenback also posted its third straight week of gains.
Yen focus
The yen was steady at 159.71 per dollar, around its weakest since early September, fuelling concerns about possible intervention.
Japanese Finance Minister Satsuki Katayama said on Friday the government would respond appropriately to currency volatility.
The Australian dollar was down 0.50% at $0.6774. The Aussie is the worst-performing G10 currency against the dollar so far this month. Australia is the only G10 country for which markets are pricing a rate cut next year.
The New Zealand kiwi weakened 0.40% versus the greenback to $0.5524 for its third straight week of losses.
In cryptocurrencies, bitcoin fell 4.3% to $68,315.80. Ethereum declined 4.4% to $1,927.01.
