US Dollar continues scaling higher, hits fresh 18-month tops

   •  Today’s upbeat US macro releases reaffirmed December Fed rate hike prospects.
   •  Weaker data elsewhere revive global growth fears and driving safe-haven flows.

The US Dollar Index (DXY) kept scaling higher through the early North-American session and pushed to fresh 18-month tops, around the 97.70 region in the last hour.

The initial leg of uptick on the last trading day of the week was being driven by some safe-haven flows following weaker than expected economic data from China - the world's second largest economy, which revived global growth worries. 

Adding to this, Euro-zone PMI prints showed a significant slowdown in both the manufacturing and the services sector. This, against the backdrop of Thursday dovish shift by the ECB, prompted some aggressive selling around the shared currency and provided an additional boost to the greenback.

The already stronger buck got a further boost from pretty decent US monthly retail sales data, which along with upward revisions to October's data indicated a brisk pace of consumer spending in the fourth quarter. 

Adding to this, the US industrial production also recorded better than expected growth in November, which further bolstered expectations for a fourth Fed rate hike move at its Dec. 18-19 policy meeting and kept fueling the ongoing USD positive momentum.

The market focus now shifts to next week's highly anticipated FOMC meeting, where an update on the central bank's economic projections, especially dot-plot, will influence rate hike expectations for 2019 and eventually help determine the next leg of a directional move.

Technical levels to watch