The US dollar closed with its strongest weekly performance in more than seven months on Friday following robust advance retail sales and producer prices data for September strengthening expectations the Federal Reserve will raise interest rates in December.
The greenback briefly gave back some gains versus the Japanese yen and euro after Fed Chair Janet Yellen said US policymakers might need to run a "high-pressure" economy to reverse damage from the last financial crisis.
The dollar index, climbed 0.4 percent to 97.935. It was up 1.4 percent for the week and 2.5 percent for the month so far. The safe-haven yen and Swiss franc slipped versus the dollar after risk sentiment got a boost from Chinese data showing producer prices rose for the first time in nearly five years. That boded well for the global economy which has been battling the threat of deflation in recent months.
Retail sales data, recorded a 0.6 percent rise last month after dropping 0.2 percent in August, and lifted the dollar. Other data on Friday suggested a pickup in inflation, with producer prices rising broadly last month to record their biggest year-on-year increase since December 2014.
Minutes from the latest Fed meeting in September, released on Wednesday, prompted traders to raise their bets of an interest rate increase in December, to a 70 percent chance.
USD/JPY rose 0.3 percent to 104.03. It was up 1.2 percent for the week. EUR/USD fell to 1.0992, after earlier hitting 1.0983, its weakest level since late July. It was down 1.6 percent for the week, its worst weekly performance since late February.
