The U.S. dollar, on Thursday, November 17, soared to a 13-1/2-year high alongside the global stock indexes which jumped after comments by U.S. Federal Reserve Chair Janet Yellen bolstered the case for raising interest rates in December, Reuters reports.
Yellen, who testified on the economic outlook before the congressional Joint Economic Committee, indicated little had changed following the victory of Donald Trump in the Nov. 8 U.S. presidential election.
She said she intended to serve out her term, which ends in 2018, and indicated the Fed remained on track to raise rates at its meeting next month
The dollar index .DXY, tracking the greenback relative to a basket of six foreign currencies, extended gains in U.S. afternoon trading following Yellen’s comments, and was last up 0.5 percent.
Strength in the dollar weighed on gold, which fell to a 5-1/2-month low of $1,210.73 XAU=.
Expectations have been high among investors that the Fed will raise rates in December.
Also the dollar was helped by the upbeat U.S. economic data, which stoked expectations of an acceleration in U.S. economic expansion in the fourth quarter.
U.S. stocks, which rallied last week after Republican Donald Trump’s surprise White House win on the potential for economic stimulus, also rose, led by gains in financials .SPSY, which benefit from higher rates.
