The dollar index (DXY00) rallied to a 2.5-week high on Friday and finished up by +0.47%. The dollar rallied on Friday on concerns that strong US economic news and soaring crude oil prices will prompt the Fed to tighten monetary policy, a bullish factor for the dollar. Friday's economic news was bullish for the dollar after the May Empire manufacturing survey general business conditions unexpectedly rose to a 4-year high, and Apr manufacturing production posted its biggest increase in 14 months. Also, the 10-year T-note yield rose to an 11.75-month high of 4.60% on Friday, strengthening the dollar's interest rate differentials. Finally, slumping equity markets on Friday boosted liquidity demand for the dollar.
The US May Empire manufacturing survey of general business conditions unexpectedly rose +8.6 to a 4-year high of 19.6, stronger than expectations of a decline to 7.2.
