The Dollar Index climbed to the highest level in almost three years amid speculation the Federal Reserve is moving closer to ending its program of asset purchases on signs U.S. economic growth is improving.
The dollar had its biggest rally since February as signs of labor market strength suggested the Federal Reserve may reduce stimulus sooner than its peers, driving the yen lower than 100 for the first time since 2009.
The yen weakened beyond 100 per dollar for the first time in four years as the Bank of Japan’s deflation-fighting measures have the currency headed for its longest streak of monthly losses in almost two decades.
U.S. stocks rose as jobless claims fell and earnings topped forecasts, while the pound strengthened against the dollar after data showed the U.K. economy avoided a triple-dip recession. Gold rallied for a second day.
The pound rose by the most since July against the dollar after a government report showed the U.K. economy grew more last quarter than analysts forecast, ensuring the nation avoided a triple-dip recession.
The pound jumped the most in nine months against the dollar this week as a government report showed the U.K. economy avoided a recession last quarter, damping speculation the Bank of England will boost stimulus.