US Dollar Index Rises to 19-Month High at 103.02

The US dollar index, which tracks the greenback against a basket of major currencies, rose 0.15% to 103.02 on Thursday, its highest level since April 2025.

What Is Driving the Dollar

Stronger-than-expected October inflation data and hawkish remarks from Fed officials supported the dollar. Officials voiced concern about stubborn inflation and left open the possibility of a 50-basis-point hike. Traders increased bets on further Fed tightening, and Goldman Sachs expects another hike in early next year, in addition to one in December. New York Fed President John Williams was due to speak on a panel later in the day.

Other Currencies

• Yen: the dollar was up 0.04% at 159.83 yen, after reversing an early decline, with the yen near the key 160 level

• Euro: up 0.06% at $1.1096

• Sterling: down 0.1% at $1.3266

• Australian dollar: little changed at $0.6847

• New Zealand dollar: down 0.05% at $0.5559

• Bitcoin: down 0.63% at $73,848.24

• Ether: down 0.49% at $2,058.18

Bank of Japan Outlook

Wider interest-rate differentials are weighing on the yen. A Reuters poll expects the next Bank of Japan rate hike as soon as next month. Japan’s top currency diplomat, Atsushi Mimura, warned that summer intervention should not be forgotten.

Analysts’ View

Gavin Friend of National Australia Bank said Fed officials appear eager to talk up rate hikes after the hotter October inflation report. Sho Suzuki of Matsui Securities said caution will rise if the dollar moves above 160 yen, but without stronger Fed hike expectations or fading Bank of Japan hike expectations, he sees the pair lacking momentum to break through that level.