The dollar rose to five-week highs on Wednesday, bolstered by an upbeat assessment of the U.S. economy from the Federal Reserve's new chairman, which raised expectations the central bank could aggressively increase interest rates over the next two years.
The greenback in February was on track to post its best monthly performance since November 2016. Also helping the dollar was a euro that fell to six-week lows after euro zone inflation slowed to a 14-month low, underlining the European Central Bank's caution in removing stimulus in the region.
The dollar also rose to three-week highs against the Swiss franc, a two-week peak versus sterling and a two-month high against the Canadian dollar.
"The dollar has found tailwinds in America's sturdy economy and its hawkish central bank," said Joe Manimbo, senior market analyst, at Western Union Business Solutions in Washington.
Fed Chairman Jerome Powell struck an optimistic tone about the U.S. economy on Tuesday, fueling views the U.S. central bank would raise rates four times this year rather than three.