STRONGER US dataflow and upbeat commentary from Federal Reserve chair Janet Yellen were the catalysts for broad-based US dollar strength during the week.
In the House testimony, Yellen mentioned that the US economy is “performing well” and that if dataflow remained solid then a December rate hike would be a “live possibility”. She also added that core inflation remained below target but survey measures of inflation expectations are reassuring. Elsewhere, the increase in the ADP employment, the strong non-manufacturing ISM survey, and the narrowed trade deficit all helped to support the strengthening of US dollar.