Dollar index hits 2-month highs on China move, U.S. optimism

© Reuters. Dollar strengthens broadly vs. rivals, hits 2-month peak

Investing.com – The dollar strengthened broadly to two-month highs against the other major currencies on Friday, as a surprise rate cut in China dampened risk sentiment and the previous session’s upbeat U.S. data continued to support the greenback.

The dollar was higher against the yen, with up 0.33% at one-month highs of 121.10.

The greenback strengthened broadly after for the sixth time since November in another attempt to boost the economy.

The dollar was also boosted after data on Thursday showed that in the week ending October 17 increased by 3,000 to 259,000. Analysts had expected jobless claims to rise by 9,000 to 265,000.

A separate report showed that increased by 4.7% to 5.55 million units last month from 5.30 million in August, compared to expectations for a 1.4% rise.

The euro erased earlier gains and was down 0.74% at two-month lows of 1.1022.

The single currency remained under pressure after European Central Bank President Mario Draghi said on Thursday that the central bank will “reexamine” its monetary policy in December, hinting at the possibility for further easing measures.

Earlier Friday, research group Markit said that ticked down to 51.6 this month from 52.3 in September, while the rose to 55.2 from 54.1.

In France, the came in at 50.7 in October, Market reported, up from 50.6 the previous month, while the ticked up to 52.3 from 51.9.

For the entire euro zone, Markit said the , which includes both manufacturing and service sector activity, rose to 54.0 in October from 53.6 the previous month.

Elsewhere, the dollar was higher against the pound and the Swiss franc, with shedding 0.36% to 1.5337 and with advancing 0.40% to 0.9770.

The Australian dollar was higher, with up 0.18% at 0.7220, while dropped 0.65% to 0.6750.

gained 0.51% to trade at three-week highs of 1.3159.

Data earlier showed that fell 0.2% in September, compared to expectations for a 0.1% downtick. rose 1.0% last month, disappointing expectations for a 1.1% increase.

, which excludes the eight most volatile items, ticked up 0.2% last month, compared to expectations for a 0.3% gain.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.68% at 97.07, the highest level since August 19.

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Dollar index hits 2-month highs on China move, U.S. optimism