World currencies
The dollar is more than holding its own against other world currenciesReuters

The US dollar continued to rally on Friday, pushing down major currencies to new lows, as the market expects an upward revision of the second quarter GDP figures in the data release later on in the day.

The USD index, the gauge that measures the strength of the US currency against a basket of major units, has bounced back near the new four-year high touched early Thursday (25 September).

The dollar index rose to as high as 85.31 in the Asian session of Friday and is just a few points away from the multi-year high of 85.48 touched a day before.

Thursday in the US session, the greenback had suffered a setback from the durable goods orders and PMI data.

Durable goods orders fell 18.2% in August, more than the consensus of 18.0% fall, and compared to the previous month's 22.5% growth.

As per the flash estimates on Thursday, US services PMI dropped to 58.5 in September from 59.5 in August, while the market had been waiting for 59.5. The composite PMI too fell, to 58.8 from 59.7.

In case of any downward revision in the Q2 GDP numbers at the release later on Friday, the dollar will turn south again. However, trading in Asia shows that the market prefers to stay bullish on the greenback.

As per the preliminary estimates, the US economy expanded 4.2% annualised in the April-June period, making a sharp rebound from the Q1 reading of -2.1%.

The market consensus for Friday's reading is 4.6% and the realisation of the same will strengthen the call for sooner rate hikes by the Federal Reserve.

Major currencies

The euro fell to a 22-month low of 1.2697 on Thursday but managed a comeback to 1.2765 early Friday helped by the slight confidence reflected in the words of ECB President Mario Draghi.

Draghi said on Thursday that he expects the Eurozone to grow modestly in the second half of the year, helped by the ECB's recent stimulus steps.

He also downplayed the potential impact of the sanctions on and by Russia related to the Ukraine crisis on the region's economy, saying the effect so far has been limited.

Sterling was down for the third straight day and has slipped to 1.6886 on Friday from the previous close of 1.6319.

The UK currency had bounced off a near one-year low last week as the Scottish referendum ended up keeping the Kingdom united, but of late, the very strong dollar bullishness has been weighing on the pound too.

The Japanese yen is holding near the six-year low of 109.48 touched against the dollar last week.

The Aussie dollar slipped to a near eight-month low of 0.8758 against the US dollar on Friday as a data release showed the pace of economic activity index slowed in China. The AUD/USD pair was at 0.8784 just before the data was released.