Dollar Post Record Advance Versus Euro on Fed Tone

The dollar ended another week gaining versus the euro and the pound as the economic conditions in North America remain far more attractive than in the other side of the Atlantic, increasing the number of traders who are switching their investments from Europe towards the United States.

After completing the sixth straight weeks advancing versus the euro, the dollar set the record for the longest weekly winning streak versus Europe’s single currency in 10 years, after the Federal Reserve rose its discount rate for the first time in three years, signaling that the economic recovery in the U.S. is likely to allow central bankers to lift stimulus and eventually raise interest rates in the country sooner than expected, making the dollar to gain versus virtually all of the 16 main traded currencies towards the end of this week. The pound also declined sharply versus the greenback as the country’s budget deficit is also raising concerns regarding the future of the British economy.

The current trading scenario for the greenback is nearly perfect, as the U.S. economy is providing positive data and the present situation in other economic regions around the world, specially in Europe, is bringing more investors to switch their preferences to the U.S. dollar in currency markets.

EUR/USD ended the week at 1.3609 from as high as 1.3770 during the week.

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