Dollar Rises Against Major Counterparts

(RTTNews) - The U.S. dollar climbed higher against most of its major rivals on Friday, on safe-haven appeal after data showed in a drop in U.S. consumer sentiment, and amid signs of growing stress in the banking sector and the impasse over raising the U.S. debt ceiling.

U.S. Treasury Secretary Janet Yellen has warned that a default on the U.S. debt would be catastrophic and was "unthinkable."

The dollar also benefited from comments from Federal Reserve Governor Michelle Bowman indicating interest rates will need to remain sufficiently restrictive for some time to bring inflation down and create conditions that will support a sustainably strong labor market.

A report from the University of Michigan showed U.S. consumer sentiment deteriorated by much more than anticipated in the month of May.

The report said the consumer sentiment index tumbled to 57.7 in May from 63.5 in April, while economists had expected the index to edge down to 63.0.

With the much bigger than expected decrease, the consumer sentiment index slumped to its lowest level since hitting 56.8 last November.

Data from the Labor Department showed import prices climbed by 0.4% in April after falling by a revised 0.8% in March.

Economists had expected import prices to rise by 0.3% compared to the 0.6% decrease originally reported for the previous month.

The report also said export prices rose by 0.2% in April following a revised 0.6% drop in March. The uptick in export prices matched economist estimates.

The dollar index climbed to 102.71, gaining about 0.65%.

Against the Euro, the dollar firmed to 1.0852 from 1.0917. The dollar is up at 1.2450 against Pound Sterling, strengthening from 1.2510.

Against the Japanese currency, the dollar is strong, fetching 135.73 yen a unit, compared with 134.56 yen on Thursday.

The Aussie is weak against the dollar with the AUD/USD pair trading at 0.6643. Against Swiss franc, the dollar is stronger by nearly 0.5% at CHF 0.8984. Meanwhile, the Loonie is weak at C$1.3557 a dollar.