The U.S. dollar was looking to regain steam after a bumpy start to the week.
In early trading Thursday, March 1, the U.S. Dollar Index reached 90.84 against a basket of other major global currencies. That level is the highest since Friday, Jan. 12, when the index reached 90.97.
Earlier in the week, the dollar continued a slump that saw it fall to three-year lows on Tuesday, Feb. 27. At that time, traders appeared to take caution ahead of testimony from new Federal Reserve Chairman Jerome Powell in front of Congress.
The greenback hit its lowest levels since late 2014 earlier in February before recovering more than 2% in the last month.
The dollar's apparent comeback came on the heels of Powell's testament to the strength of the U.S. economy that bolstered some bets the Fed will hike interest rates four times this year instead of the previously expected three times.
Powell's comments on the continued strengthening of the U.S. economy were magnified by comparison to Europe's economy. European Central Bank President Mario Draghi said Monday, Feb. 26, that slack in the eurozone's economy could be larger than originally thought. Against the yen, the euro fell this week to its weakest since early September, down 5.6% from a more than two-year high tallied last month.
Despite recent momentum, the dollar had declined 1.4% since the start of the year. Investors have maintained caution that President Trump might prefer a weaker dollar in order to rebalance the trade deficit in the country. Additionally, concerns abound that a growing fiscal deficit could make U.S. debt less attractive.
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