NEW YORK: The dollar rose to a seven-week high on Wednesday, boosted by safe-haven bets amid the risk of a US debt default, with traders paring back bets on a Federal Reserve interest rate cut any time soon following solid US consumer spending and housing data. The US dollar index, a measure of the greenback’s value against six major currencies, climbed as high as 103.12, its strongest level since late March. It was last up 0.3% at 102.91.

The euro, meanwhile, dropped to a six-week low versus the dollar at $1.0811. It last changed hands at $1.0830, down 0.3%.

“Recent data is painting a more resilient picture of US growth compared to Europe,” said Joe Manimbo, senior market analyst at Convera in Washington.

Wednesday’s data showed that US single-family homebuilding increased in April, but data for the prior month was revised sharply lower.

Single-family housing starts, which account for the bulk of homebuilding, rose 1.6% to a seasonally-adjusted annual rate of 846,000 units last month. Data for March was revised down to show single-family homebuilding falling to a rate of 833,000 units instead of increasing to a pace of 861,000 units as previously reported.

US industrial production also gained, advancing 1% last month, easily topping expectations for a flat reading and up slightly from the revised 0.8% increase in March. In late morning trading, the dollar rose 0.7% versus the yen to 137.37 yen, after earlier climbing to a two-week peak of 137.445.

The dollar also traded higher against sterling, which fell 0.2% to $1.2465. The pound fell as low as $1.2422, the weakest level since late April.

US debt ceiling talks remained in focus.

Elsewhere, the Chinese yuan weakened past 7 per dollar on Wednesday for the first time in five months amid geopolitical tensions and more signs of China’s post-COVID-19 recovery losing steam. In the offshore market, the dollar rose 0.2% to 7.00911.