Dollar Posts Weekly Gains as Fed Says More Increases Possible

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The dollar posted its biggest weekly gains in a month versus the euro and yen as the Federal Reserve indicated it may lift borrowing costs again, after pausing in its interest-rate boosts for the first time in two years.

The U.S. currency added to gains yesterday after a government report showed retail sales surged in July, reinforcing speculation the Fed will increase rates again this year. Entering this week, traders were betting the dollar would fall as the Fed paused, and their buying of the currency to exit those bets fueled the rally, strategists said.