By Gina Lee

Investing.com – The dollar was up on Friday morning in Asia, and is poised to post a second week of gains against the euro. Now, the focus will be on when central banks are going to raise interest rates as a response to inflation.

This indicator tracks the greenback’s performance against a basket currency. It was 0.12% higher at 95.657 as of 11:55PM ET (4:55 GMT)

The pair inched up 0.10% to 114.36, with Japan’s and both growing 0.1% year-on-year in October.

In comparison, the pair dropped 0.06% at 0.7275 while it rose 0.02% to 0.7037.

While the pair increased by 0.01%, it fell to 6.3856. The pair dropped by 0.01% at 1.3486. The Bank of England is expected to raise interest rates by December, as the inflation rate rose to its highest level in 10 years.

The dollar reached a new 16-month high of $1.1263 after falling 0.6% against the euro in the week just gone. The euro was last seen trading at 1.1372 on Monday, after having dropped to $1.1263 earlier. Investors believe that it is still vulnerable, as the fundamentals of dollar positioning continue to swing in favor of the dollar.

Societe Generale strategist Kit Juckes said to Reuters that previous post-global crises occasions in which the euro was trading below $1.10 had been accompanied by a large euro short position.

If the question was “Will the market get very few euros now?” then my answer would be yes, unless the data is improved dramatically.

Several central bankers, including European Central Bank President Christine Lagarde, Bank of England economist Huw Pill and the U.S. Federal Reserve’s Christopher Waller, Richard Clarida, and Mary Daly, will speak later in the day.

The possibility of a more hawkish monetary policy, which will raise the interest rate 50 basis points (bps), is also causing bets to rise.

Analysts at ANZ Bank stated in a note that rates markets are still cautious and data pushed bellwether’s two-year swap up to a new year high, which in turn put the bid down behind the kiwi.”

“With 36 bps of hikes priced in for next week and 198 bps priced in over the next eight meetings, local markets could be setting themselves up for some real disappointment if we ‘only’ get a 25-bps hike, as we expect,” the note added.