Dollar rises with a boost from strong US data

The dollar rose on Friday and was heading for a third straight month of gains after data showed strong growth in the United States, indicating enhanced prospects for interest rates to remain high for a longer period.

But the yen remained around the 150 level to the dollar before the Bank of Japan’s meeting next week.

Data on Thursday showed that the US economy grew at the fastest pace in nearly two years in the third quarter, as rising wages as a result of a strong labor market helped boost consumer spending.

With the release of new surveys that also showed the strength of business activities as well, expectations increased that the Federal Reserve (US Central Bank) would continue to tighten monetary policy for a longer period, which pushed the dollar to rise significantly this week.

The dollar index settled at 106.52 after reaching the highest level in three weeks at 106.89 in the previous session, and is heading for weekly gains of about 0.35 percent.

The euro had difficulty achieving gains and settled at $1.0559, on its way to recording a weekly loss of 0.25 percent.

The European Central Bank decided on Thursday to keep interest rates unchanged as expected, ending an unprecedented series of 10 consecutive interest rate increases.

Data earlier this week showed business activity in the euro zone surprisingly declined this month.

The pound sterling fell 0.1 percent to $1.2117, which is slightly higher than the lowest level in three weeks recorded on Thursday at $1.2070.

The Australian dollar rose 0.4 percent to $0.635 after falling to a one-year low of $0.6271 on Thursday.

The Japanese yen continued to fluctuate on the weaker side at 150 to the dollar, a level that some say could lead to intervention by the Japanese authorities.

The yen rose more than 0.2 percent to hover around 150.10 to the dollar, which is slightly more than its lowest level in a year, which was recorded on Thursday at 150.78.

The Bank of Japan is scheduled to meet next week amid growing speculation that it may change its policy on controlling bond yields.