The USD hit a 7-week high on solid economic data and hopes for a debt ceiling deal, reducing expectations of Fed easing. Positive reports included lower-than-expected jobless claims (242,000 vs. 254,000 forecast) and a milder-than-expected decline in the Philadelphia Fed’s business index (-10.4 vs. -19.8 expected). The dollar index reached 103.38, a 7-week high, while against the yen, it reached a 5-month peak of 138.39. Traders now see a 20% chance of a Fed interest rate hike in June, compared to expectations of a rate cut a month ago.
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