The dollar rises after Powell confirms expectations of tightening monetary policy

The dollar rose on Wednesday, a day after it suffered its biggest loss in more than two months after US Federal Reserve Chairman Jerome Powell emphasized tighter monetary policy as the US central bank sought to contain rising inflation.

Powell pledged that the central bank would raise interest rates as often as necessary, including bypassing the neutral level, in order to contain inflation, which he said threatens the foundations of the economy.

The level of neutrality is the interest rate that does not stimulate or restrict economic activity.

By 0810 GMT, the US dollar index rose 0.3 percent to 103.59, after hitting its lowest level in two weeks earlier, after falling on Tuesday by 0.9 percent.

The euro fell 0.3 percent to $1.0516, reversing its trend after earlier climbing to a one-week high, a day after European Central Bank Council member Klaas Knott said a 50 basis point increase in European interest rates in July was possible if inflation continued to rise.

The price of the pound sterling fell 0.7 percent to $ 1.2406 after data showed that British inflation rose to nine percent last month.

The yen rose 0.1 percent to 129.14 yen to the dollar, stable at a level slightly higher than its lowest level in 20 years reached last week.