Investing.com - The dollar rose to fresh 14-year highs against a basket of currencies on Thursday as upbeat U.S. data and Federal Reserve minutes cemented expectations for a rate hike next month.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was last at 102.07, the highest level since April 2003.
Wednesday’s minutes from the Fed’s November meeting said an interest-rate increase was possible “relatively soon” if data indicated that the economy is improving.
Some Fed officials explicitly called for a rate hike in December, the minutes showed.
Earlier Wednesday data showed that U.S. durable goods orders rose at the fastest rate in a year in October.
A separate report showed that a gauge of U.S. consumer confidence rose strongly in November.
According to Investing.com's Fed Rate Monitor Tool, odds for a rate hike at the Fed's December 13-14 meeting are at 95.4%.
Expectations for higher interest rates typically boost the dollar by making it more attractive to yield seeking investors.
The dollar has also been boosted by expectations that plans by the Trump administration to ramp up fiscal spending and cut taxes will spur economic growth and inflation.
Faster growth would spark inflation, which in turn would prompt the Fed to tighten monetary policy a faster rate than had previously been expected.
The dollar was at eight-month highs against the yen, with USD/JPY up 0.75% at 113.40.
The euro fell to one-year lows, with EUR/USD down 0.13% 1.0536.
In the euro zone, data on Thursday confirmed that German third quarter growth slowed to 0.2% as weak export growth acted as a drag on the economy.
The pound edged lower, with GBP/USD slipping 0.14% to 1.2418 a day after the government ramped up its borrowing forecast and cut its outlook for growth, saying the vote to exit the European Union would damage the economy.
Trade was expected remain quiet on Thursday; with U.S. markets closed for the Thanksgiving Day holiday.