Dollar Rises Sharply on Fed Chair's Hint of Rate Hike

The U.S. dollar surged on Thursday after Federal Reserve Chair Kevin Warsh hinted at a possible interest rate hike in his speech at the central bankers' symposium in Jackson Hole.

Warsh stated that the Fed 'would have work to do' if inflation did not continue moving towards its 2% target, sparking a market interpretation of a potential tightening of monetary policy.

The dollar index, which measures the currency against a basket of major currencies, rose 0.59%, its biggest daily jump since June 17, reaching 99.69 and climbing as high as 99.727 during trading.

This marked the dollar's best week in 10 weeks, with nearly a 0.9% gain over the period. The euro fell 0.59% to $1.1582, while the British pound dropped 0.47% to $1.3528.