US dollar ends week on a strong note

The greenback rose in the currency market on Friday ahead of Wednesday’s Federal Reserve decision. It started to rise after higher-than-expected US inflation data and then extended gains.           

The US Dollar index, which gauges the US dollar against its main competitors, opened the day around 95.20 and peaked during the American session at 96.06, the strongest since September 1st. It was about to end Friday around 96.00, a daily gain of 0.85%, the best performance since late August.

The index strengthened after breaking above the 95.60 area that capped the upside during the previous three trading days. The challenge now for the DXY is to rally above 96.00. What happens during the next week could be determined by the decision on Wednesday of the Federal Reserve on monetary policy.

Among the worst performers on Friday was the Mexican peso that hit record lows against the US dollar and also the pound. Cable dropped from above 1.3200 toward 1.3000 while EUR/USD  broke the 1.1200 short-term barrier. USD/JPY  rose on Friday back above 102.00, ending the week marginally lower.