The dollar rose to a one-month high against a basket of currencies on Thursday as data on U.S. inflation and business orders revived confidence in the world's biggest economy and supported bets the Federal Reserve will raise interest rates in the middle of the year.
The greenback also received support from San Francisco President John Williams and St. Louis Federal Reserve chief James Bullard, with both making remarks that suggested the U.S. central bank might end its near zero interest rate policy sooner than some traders expect.
The dollar's rise followed back-to-back days of declines stemming from perceived dovish signals from Fed Chair Janet Yellen in her semiannual testimony before Congress.
On Thursday, the government said the consumer price index, its broadest inflation gauge, fell 0.7 percent in January because of the steep drop in oil prices, but its core reading, which excludes food and energy costs, rose 0.2 percent, more than the 0.1 percent increase economists had expected.
"It undermined the view that there's domestic disinflation. It's more an international story about falling prices in goods and commodities," said Alan Ruskin, global head of currency strategy at Deutsche Bank in New York.