USD rose against major counterparts on hawkish Fed betting and strong consumer spending data

USD gained broadly on Wednesday before falling slightly at press time. Earlier in the day, USD has reached its 16-month high against EUR and 5-year high against JPY. Investors are betting that the Fed will tighten monetary policy faster than expected.

The latest data showed that US consumer spending increased significantly in October. Personal spending rose 1.3% in October, while income increased 0.5%. Economists polled by Reuters had forecast the growth rate to be 1.0%. On the other hand, Germany’s Q3 GDP grew only by 1.7% on a quarterly basis, from July to September. German household spending was the sole driver of a weaker-than-expected economic expansion.

DXY Index is currently trading at 96.71. Despite falling by 0.17% since the session started, it is still staying high enough above the 96-level.