The US dollar strengthened against major rivals on Tuesday, reaching a five-month high against the pound sterling and euro, while the Japanese yen languished at its lowest point since 1990, Reuters reported. The yen currently trading at around 154.64 per dollar, inching closer to the critical resistance level of 155 identified by analysts. The euro dipped 0.1 per cent to $1.0615, marking its weakest position since early November 2023. This follows the European Central Bank's (ECB) recent indication of a potential rate cut in June, creating a divergence in monetary policy expectations between the US and Europe. Sterling also lost ground, falling to a five-month low of $1.2409 before settling at $1.2438. This comes despite data showing relatively strong British core wage growth. The dollar's surge follows stronger-than-expected US retail sales data for March, which bolstered expectations of continued interest rate hikes by the Federal Reserve. Data released on Monday revealed a 0.7 per cent increase in US retail sales for March, exceeding economist predictions of a 0.3 per cent rise. This robust performance suggests a resilient US economy, potentially discouraging the Fed from considering near-term rate cuts. The US dollar index, a measure of the greenback's strength against a basket of currencies, rose 0.1 per cent to 106.43, marking its highest level since November 2023.
