Investing.com - The U.S. dollar rose to a more than eight-month peak against its major counterparts on Friday, as demand for the greenback remained underpinned amid growing confidence the Federal Reserve will raise interest rates when in meets next month.
Trading volumes were thin on Friday due to the Thanksgiving holiday in the United States. The U.S. stock market closed at 1:00PM Friday after being closed Thursday for Thanksgiving.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, ended Friday's session up 0.19% at 100.05. It earlier rose to 100.26, a level not seen since March 16.
The greenback remained broadly supported after a string of upbeat U.S. data released over the week added to expectations that the Federal Reserve will raise interest rates next month.
For the week, the dollar index tacked on 0.45%, the second straight weekly gain, amid the diverging monetary policy outlook between the Fed and its major peers around the globe.
The euro struggled near seven-month lows on Friday as traders looked ahead to next week's European Central Bank meeting for further signals of potential divergence in monetary policies in the U.S. and the euro zone.
EUR/USD slumped 0.17% to 1.0593 in late trade, not far from Wednesday’s seven-month trough of 1.0565. The pair ended the week down 0.5%.
The single currency could fall even further next week if the ECB's Governing Council institutes further easing measures to stimulate the economy and bolster inflation at its meeting in Frankfurt.
Over the last few weeks, ECB president Mario Draghi has sent strong indications that the central bank could increase the scope of its €60 billion a month quantitative easing program at the December meeting.
Meanwhile, the dollar climbed to a five-year high against the Swiss franc (USD/CHF), amid speculation the Swiss National Bank could cut deposit rates further into negative territory.
The greenback also rose to multi-month highs against the pound (GBP/USD), after Bank of England Governor Mark Carney said in testimony to lawmakers earlier in the week that the U.K.'s low-interest rate environment is likely to remain for some time.
Elsewhere, gold slumped to the lowest level since February 2010 in holiday-thinned trade on Friday, as market players prepared for a U.S. rate hike next month, while oil ended the week lower as concerns about a global supply glut pressured prices.
In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report for November, the last jobs report before the Federal Reserve decides on interest rates at its December 15-16 meeting.
The outcome of Thursday’s European Central Bank meeting will also be in focus amid speculation the central bank could ramp up its monetary stimulus program.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, November 30
Japan is to release data on retail sales.
New Zealand is to release a report on business confidence.
In the euro area, Germany is to release preliminary data on inflation as well as a report on retail sales.
The U.S. is to publish a report on manufacturing activity in the Chicago region as well as private sector data on pending home sales.
Tuesday, December 1
China is to release reports on manufacturing and service sector activity from the China Federation of Logistics and Purchasing, as well as the Caixin services index and the revised reading of the Caixin manufacturing index.
The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Switzerland is to release data on retail sales.
Germany is to publish data on the change in the number of people unemployed.
Bank of England Governor Mark Carney is due to hold a press conference about the Financial Stability Report and U.K. Bank Stress Test results, in London. The U.K. is to produce a report a manufacturing activity.
The euro zone is to publish a report on the unemployment rate.
Canada is to publish its monthly report on economic growth.
In the U.S., the Institute of Supply Management is to release data on manufacturing activity.
Wednesday, December 2
RBA Governor Glenn Stevens is due to speak at the Australia-Israel Chamber of Commerce breakfast, in Perth. Australia is to publish data on third quarter gross domestic product.
In the euro zone, Spain is to release data on the change in the number of people unemployed.
The U.K. is to publish survey data on construction activity.
The euro zone is to publish preliminary data on consumer price inflation.
The U.S. is to publish the ADP report on private sector jobs creation as well as weekly data on crude oil stockpiles. Fed Chair Janet Yellen is due to speak about the U.S. economic outlook at The Economic Club of Washington D.C.
The Bank of Canada is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Thursday, December 3
Australia is to release data on the trade balance.
The U.K. is to publish survey data on service sector activity.
The ECB is to announce its monetary policy decision. The rate announcement will be followed by a post-policy meeting press conference with President Mario Draghi.
The U.S. is to release data on initial jobless claims and factory orders, while the ISM is to publish data on service sector activity in the U.S. Fed Chair Yellen is due to testify about monetary policy before the Joint Economic Committee, in Washington D.C.
Friday, December 4
Australia is to release data on retail sales.
Germany is to release data on factory orders.
Canada is to publish its monthly employment report and data on the trade balance.
The U.S. is to round up the week with the closely watched report on nonfarm payrolls.