The dollar index held above 105 on Friday, hovering at its highest levels in six months as robust US economic data raised hopes that the Federal Reserve could engineer a soft landing even if it keeps interest rates higher for longer. US retail sales advanced 0.6% MoM in August, beating forecasts for a 0.2% gain while producer prices increased 0.7%, the most since June 2022 and exceeding market expectations for a 0.4% rise. Traders are still betting that the Fed would hold rates steady next week, while the central bank’s next policy move in November remains up for debate. The dollar also gained against the euro after the European Central Bank delivered what many analysts believe is the last hike in its current tightening cycle. Meanwhile, the greenback weakened versus the yuan after China posted stronger-than-expected economic numbers for August.
