Dollar Advances As Strong U.S. PPI Data Raises Fed Rate Hike Concerns

(RTTNews) - The U.S. dollar rebounded against its major opponents in the European session on Friday, as the nation's producer inflation rose more than expected in November, raising concerns about the Federal Reserve's outlook for interest rates.

Data from the Labor Department showed that the producer price index for final demand rose by 0.3 percent in November, matching upwardly revised increases in October and September.

Economists had expected producer prices to inch up by 0.1 percent compared to the 0.2 percent uptick originally reported for the previous month.

Meanwhile, the report showed the annual rate of producer price growth slowed to 7.4 percent in November from 8.1 percent in October, in line with economist estimates.

The data fuelled concerns that the Fed may tighten policy for longer and cause a slowdown in economic growth.

The Fed will hold its policy meeting on December 13-14, when it is expected to raise rates by 50 basis points.

The greenback climbed to 1.0503 against the euro, from a 4-day low of 1.0588 seen at 2:05 am ET. If the greenback rises further, it may locate resistance around the 1.03 level.

The greenback advanced to 1.2200 against the pound, from a 4-day low of 1.2297 it touched at 8:20 am ET. The greenback may test resistance around the 1.18 region, should it rallies again.

The greenback edged up to 136.82 against the yen, from a 4-day low of 135.60 it logged at 8:20 am ET. The currency is likely to challenge resistance around the 138.00 level.

The greenback was up against the loonie, at a 2-day high of 1.3691. The greenback is seen finding resistance around the 1.38 level.

The greenback recovered to 0.6742 against the aussie and 0.6360 against the kiwi, off its early 4-day lows of 0.6800 and 0.6414, respectively. The next possible resistance for the dollar is seen around 0.66 against the aussie and 0.61 against the kiwi.

The greenback rose to 0.9382 against the franc, after hitting 0.9322 at 6:50 am ET, which was its weakest level since April 13. On the upside, 0.96 is possibly seen as the next resistance level.