Dollar Rises Amid U.S.-China Summit and Inflation Fears

The U.S. dollar strengthened on Thursday, buoyed by heightened Treasury yields as speculation grew about potential interest rate hikes by the Federal Reserve. Investors shifted their focus to the highly anticipated U.S.-China summit, where trade progress was acknowledged, but tensions remained over Taiwan.

China's yuan clung to its peak level against the dollar, with analysts anticipating stability in the short term to facilitate dialogue between the economic powerhouses. Nevertheless, there are indications that authorities may resist rapid currency appreciation through official interventions.

In broader financial markets, the dollar held its ground against the euro and yen, backed by higher inflation figures showing significant rises in U.S. producer and consumer prices. These inflationary trends did not bode well for incoming Federal Reserve Chair Kevin Warsh's policy outlook.

(With inputs from agencies.)