It's hard to see what can put the brakes on a rally in the U.S. dollar now that the Federal Reserve has outlined when it might start taking back its aggressive monetary stimulus, currency strategists say.
"The dollar will have the upper hand for the time being at least," says Paul Mackel, the head of Asia currency research at HSBC in Hong Kong.
"We didn't get much of a respite after [Fed Chief Ben] Bernanke this week. Some were hoping for some soothing comments from him but it didn't happen, so this dollar upward pressure will continue," he added.
The dollar has soared against major currency counterparts and emerging market currencies alike since the Fed said on Wednesday that it could start unwinding stimulus for the U.S. economy towards the end of 2013 should economic conditions improve.
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On Thursday, the dollar hit its highest level in more than a week against the yen and rose to its strongest level in almost three years versus the Australian dollar, and held near those peaks on Friday.
The dollar index, which measures the currency's value against a basket of other major currencies in terms of trade, stood at 81.83 on Friday, up almost 2 percent from a low hit earlier this week.
"Clearly there will be more to go in terms of dollar gains," said Claudio Piron, the head of emerging Asia foreign exchange and fixed income strategy at Bank of America Merrill Lynch.
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Nick Bennenbroek, head of currency strategy at Wells Fargo, told CNBC Asia's "Squawk Box" that he expected more gains for the dollar with the currency rising to the 99 to 100 yen level in coming months from around 97.75 now.
He said the euro was likely to fall to around $1.30, suggesting a decline of roughly 1.75 percent from current levels of $1.3234, with further momentum in the dollar dependent on the move in U.S. government bond yields.
Expectations for a tapering of the Fed's asset purchase program, also known as quantitative easing, has pushed up benchmark 10-year Treasury yields to about 2.43 percent from 1.93 percent a month ago, and that rise in interest rates has boosted the appeal of the dollar, analysts say.
"There has been a dramatic move in bonds and whether the momentum in the dollar continues depends on how far that (bond move) goes," said Bennenbroek.
US Dollar Index
Wither Emerging Markets
Emerging market currencies such as the Indian rupee, Brazilian real and Indonesian rupiah, would continue to suffer from the anticipation of a change in U.S. monetary policy, currency analysts said.
The Brazilian real fell about 2 percent to about 2.27 per dollar on Thursday, its weakest level since early 2009, while the Indian rupee hit a record low, just shy of the 60 per dollar level.
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Sharp currency weakness prompted Brazil's central bank to intervene in the markets on Thursday and Indonesia's central bank hiked interest rates last week to shore up its battered currency.
"Although there have been some policy steps in the right direction, for instance tighter rates in Indonesia, it's not working. It's just not the time for these currencies to stabilize," said HSBC's Mackel.
"Central banks will try and manage the exchange-rate volatility but it's going to be very hard to do that when you are looking at the dollar and how well it's supported," he said.