The dollar was set to end the week with small gains after a turbulent several days when currencies were tossed by shifting risk appetite, with the market’s focus now on next week’s U.S. Federal Reserve meeting.

The dollar index was up 0.2% for the week, rising slightly on Friday to stand at 92.902. But that was off a 3-1/2-month high of 93.194 hit on Wednesday, after strong Wall Street earnings helped investors regain some of the confidence lost to earlier worries the Delta variant of the coronavirus could derail the global economic recovery.

The safe-harbour yen weakened about 0.2% for the week and last traded at 110.30. Meanwhile, the euro was 0.3% lower over the period at $1.1766, with most of that coming overnight after the European Central Bank pledged to keep interest rates at record lows for even longer, as widely expected.

ECB President Christine Lagarde, in her media briefing, said a fresh wave of the coronavirus pandemic could pose a risk to the region’s recovery, although she did offer a more balanced economic outlook.

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