Investing.com - The dollar extended gains against a basket of the other major currencies on Wednesday as upbeat U.S. economic reports revived expectations for a third interest rate hike from the Federal Reserve this year.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.52% at 92.75 by 10:49 AM ET (14:49 GMT).
The index plumbed a low of 91.55 on Tuesday, the weakest since January 2015.
The dollar was boosted after the Commerce Department reported that the U.S. economy grew by an annualized 3% in the second quarter, up from an initial estimate of 2.6%.
Another report showed that the U.S. private sector added a larger-than-forecast 237,000 jobs in August, the largest monthly increase in five months.
The dollar traded higher against the safe haven yen, with USD/JPY rising 0.5% to 110.24, having recovered from the previous session’s four-and-a-half month lows of 108.26.
The greenback had risen earlier in the day as markets recovered after Monday’s slide in the wake of North Korea’s missile launch over Japan. Investors took some reassurance from President Trump’s relatively measured response.
The dollar pushed higher against the Swiss franc, with USD/CHF rising 0.46% to 0.9598, well above Tuesday’s two-year trough of 0.9428.
The yen and the Swissy are often sought in times of geopolitical tension or market turbulence because both countries have large current account surpluses.
The euro extended losses against the dollar, with EUR/USD down 0.55% to 1.1906, having pulled away from Tuesday’s highs of 1.2069, the strongest level since Jan. 2 2015.
Hopes that the European Central Bank will soon announce plans to taper its bond-buying stimulus program have driven the euro up around 13% against the dollar so far this year.