Dollar hit nearly three weeks high against its rivals

The U.S. dollar advanced and reached its highest level in nearly three weeks versus a basket of currencies on Thursday. The rise came after data revealed U.S. retail sales boosted in August, easing some worries about a slowdown in economic growth.

The dollar index, which measures the greenback versus rivals, added to gains following the report. The index was last up 0.5% at 92.866, its highest level since August 27.

Retail sales surged 0.7% in August. It was partly boosted by back-to-school shopping and child tax credit payments. Meanwhile, data for July was revised down.

A report revealed U.S. initial claims for state unemployment benefits surged 20,000 to a seasonally adjusted 332,000. Economists had anticipated 330,000 applications for the latest week.

The news could bolster investor anticipations for next week’s Fed policy meeting. The market is waiting to see how soon the U.S central bank will start to taper stimulus.

On Tuesday, the U.S. dollar index declined to a one-week low of 92.321 after a softer-than-anticipated inflation report. On September 3, it hit a monthly low of 91.941, when payrolls data disappointed.

Investors are waiting for cues on the outlook for both tapering and interest rates

Investors are looking for cues on the outlook for both tapering and interest rates at the Fed’s two-day policy meeting that ends on September 23.

Moreover, tapering typically raises the greenback as it suggests the Federal Reserve is one step closer to tighter monetary policy.

It also implies the central bank will be buying fewer debt assets, reducing the number of dollars in circulation. Notably, it lifts the currency’s value.

The U.S. dollar also gained 0.3% against the safe-haven Japanese yen to settle at 109.70 yen. Remarkably, in the previous session, it fell to a six-week low of 109.110.

The euro dipped by 0.4% against the dollar to $1.1766.

The Swiss franc also slipped against the U.S. dollar. It traded at 0.9263 franc against the dollar.

Moreover, the risk-sensitive Australian dollar dipped 0.5% to settle at $0.7296.

Earlier, data revealed the country’s jobless rate unexpectedly slipped to 4.5%. However, the statistics bureau announced the change reflected a decline in the participation rate rather than a strengthening of the labor market.

In cryptocurrencies, Bitcoin, the most popular cryptocurrency, was last down 0.9% at $47,711. The second-largest cryptocurrency, Ether, changed hands at $3,589, down 0.7%.