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Dollar strengthens

Ag Reuters

SINGAPORE:The dollar edged higher against the yen on Friday and set a fresh four-month high, buoyed by a further rise in U.S. Treasury yields that suggests a more upbeat outlook for the world´s largest economy and possibly more rate hikes.

U.S. benchmark 10-year yields hit a high of 3.128 percent in early Asian trade on Friday, the highest in nearly seven years.

The U.S. 10-year bond yield has climbed about 15 basis points this week, putting it on track for its biggest weekly rise in more than three months.

The rising yields reflect continued optimism about the U.S. economy and expectations of growing price pressures, reinforcing expectations that the Federal Reserve would raise borrowing rates at least two more times this year and lifting the greenback. "Moves in U.S. yields remain the focus.

If they rise further the dollar could strengthen on the back of that and pull the dollar higher against the yen," said Shinichiro Kadota, senior strategist at Barclays in Tokyo.

The dollar touched a high of 111.005 yen, its strongest level since Jan. 23, and last changed hands at 110.92 yen, up 0.1 percent on the day.

The dollar´s index against a basket of six major currencies stood at 93.467, trading within sight of a five-month high of 93.632 set earlier this week.