The dollar strengthened on Friday after data the US economy grew stronger than previously thought in 2015.
Fourth quarter GDP data was revised much higher for the final estimate, showing the US economy expanded at an annualized rate of one per cent. This was up from a previous estimate of 0.7 per cent, and higher than the 0.4 per cent economists expected.
The data, while backward-looking, bolster the argument that the economy may be able to better withstand a slowdown in the manufacturing and energy sectors than some had feared. That could give the Federal Reserve the ability to continue tightening monetary policy this year even as other central banks, such as the European Central Bank and Bank of Japan, loosen policy in a bid to spur economic growth.
The dollar rallied soon after the GDP report on Friday. Consequently, the euro fell by 0.3 per cent against the dollar to 1.0982, while the greenback rose 0.3 per cent against the yen to 113.32.
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