NEW YORK: The dollar extended its advance against a basket of currencies on Friday, building on the gains logged after the US Federal Reserve earlier this week surprised markets by signalling it would raise interest rates and end emergency bond-buying sooner than expected.

The dollar index, which tracks the greenback against six major currencies, was up 0.38% at 92.23, its highest since mid April. That puts the index on pace for a weekly gain of about 2%, its best weekly jump in about 14 months.

With equity markets hurting, the Australian dollar - seen as a proxy for risk appetite - was down 0.75% at 0.74945, its lowest since December 2020.

Sterling extended its fall against the US dollar on Friday, dropping below $1.39, hurt by the Fed's hawkish surprise and an unexpected fall in Britain's retail sales.