Dollar Soars on US Growth as Euro Slumps to 16-Month Low

The dollar is poised for its largest monthly rise against the euro in nearly two years, driven by strong US growth and rising interest rates. The euro dipped to a 16-month low on Wednesday, trading at $1.1312 and hovering nearby in Asia.

Brent Donnelly, president of foreign exchange trading at Spectra Markets, attributed the dollar's strength to the US economy running hot, while Europe faces energy supply concerns, debt worries, and French politics. Benchmark European gas prices have spiked this month, with yields between Germany and France blowing out to their widest since 2012.

The dollar has gained nearly 2.5% against the euro in September, with its Australian counterpart falling below 70 cents for the first time since early August. The greenback has also made a 16-1/2-month top on the Swiss franc at 0.8358 francs, due to investors seeking low-yielding alternatives to the yen.