The U.S. dollar rallied to a fresh eight-month high against a basket of six other major currencies on Wednesday, after a deluge of mostly upbeat U.S. economic data reinforced the case for a Fed rate hike next month.
The dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.35% at 100.04. It earlier rose to 100.22, a level not seen since April 13.
The U.S. Commerce Department reported on Wednesday that new home sales rose by 10.7% to 495,000 units last month.
The report came shortly after the U.S. Department of Labor said first time jobless claims declined by 12,000 last week to 260,000 from the previous week’s revised total of 272,000. Analysts expected jobless claims to fall by 2,000 last week.
A separate report showed that durable goods orders jumped 3.0% in October, easily surpassing forecasts for 1.5%. Core durable goods orders, excluding volatile transportation items, rose 0.5%, beating expectations for an increase of 0.3%.
The upbeat data added to already growing expectations the Federal Reserve will raise rates for the first time in nearly a decade at its December 15-16 meeting.
Most Fed officials believe there is a strong case to begin raising interest rates next month, as long as U.S. economic data does not disappoint in the coming weeks.