TOKYO Reuters - The dollar rose relentlessly on Thursday due to expectations for a faster Federal Reserve policy tightening and safe-haven flows amid growing fears of a recession.
The greenback bounced back to parity with the euro after briefly breaching the level overnight, after reaching new 24 year highs above 128 yen.
Singapore's dollar and Philippine peso surged against their U.S. counterpart after their respective monetary authorities surprised by tightening policy in off-cycle moves.
The buck was 0.37% higher at 137.935 yen after reaching 138.015 for the first time since September 1998.
The euro fell 0.39% to $1.0020. It touched $0.9998 for the first time since December 2002.
Consumer price figures showed overnight that inflation was already at four-decade highs, accelerating even further.
In a client note, Kristina Clifton, Commonwealth Bank of Australia analyst Kristina Clifton said the U.S. inflation momentum is rising.
She said that stubbornly high inflation increases the risk that the FOMC continues to hike aggressively and triggers a recession. When it meets on July 26 -- 27, traders raised bets that the U.S. central bank could raise rates by 100 basis points. A hike of at least 75 basis points is seen as almost certain.
Atlanta Fed President Raphael Bostic said that the higher-than-expected inflation print puts a full-point increase on the table.
The dollar went up 0.11% on Thursday against Canada's loonie, to C $1.2293 after losing 0.32% overnight.
The U.S. currency fell 0.56% to S $1.3960 and plummeted 1.3929, the lowest since July 1, as the Monetary Authority of Singapore MAS tightened policy on Thursday outside of its scheduled meetings to combat soaring inflation.
The greenback lost as much as 0.52% to 56 Philippine pesos as the central bank surprised with a 75 basis-point hike.
The New Zealand dollar fell 0.31% to $0.61125, going back toward Wednesday's two-year low of $0.6081, but it didn't get much support from the central bank's as-expected half-point rate hike that day.
The jobless rate fell to a 48 year low and the prices of key export iron ore rebounded, as the Australian dollar was little changed at $0.67605.
The pound fell by 0.4% to $1.1847, falling back to a two-year low of $1.18075 reached earlier in the week. The British economy was unexpectly expanded in May, and it had gotten a bit of a boost overnight from data showing the British economy was unexpectly expanded in May.