Dollar on track for second straight weekly gain

The US dollar is on track for its second straight weekly gain against a basket of major currencies, supported by positive economic data that has bolstered expectations that the Federal Reserve will keep interest rates unchanged for a longer period.

The dollar index was steady at 98.456 at 00:38 GMT, continuing its weekly gain of 0.64%, after rising 0.91% last week. It had reached its highest level since June 23 at 98.951 following strong retail sales data and a drop in jobless claims to a three-month low, according to Reuters.

Conversely, the Japanese yen remained under pressure ahead of Sunday’s Senate elections, which threaten the ruling coalition’s parliamentary majority, increasing political uncertainty and complicating trade negotiations with the United States. The dollar held near a three-and-a-half-month high of 148.60 yen, up 0.73% for the week. As market bets on a rate cut decline, swaps contracts show that traders now expect a cut of about 45 basis points by the end of the year, compared to 50 points a week ago.