The US dollar rose on Friday, heading for its best week in nearly three years as traders reacted to a relatively hawkish stance from the Federal Reserve, healthy economic data, and the imposition of new US tariffs on a series of trading partners.
The dollar index, which tracks the greenback against a basket of six other currencies, rose 0.1% to 99.870, heading for a gain of about 2.5% this week, its best weekly performance since September 2022.
US President Donald Trump signed an executive order Thursday night raising tariffs of up to 50% on dozens of countries, with the duties set to take effect at 12:01 a.m. on August 7.
Major industrialized economies such as the European Union, Japan, and South Korea will face 15% tariffs, while other countries will face higher tariffs, including a 50% tariff on Brazil.
Trump also raised tariffs on Canada to 35% for goods that do not comply with the United States-Mexico-Canada Agreement, which was signed during Trump's first term
