(fxcue news) - The U.S. dollar strengthened against other major currencies in the early European session on Friday, as traders eagerly await the release of closely watched U.S. inflation data later in the day that may shed additional clues on the interest-rate outlook. The Commerce Department's report on personal income and spending for May includes readings on inflation said to be preferred by the Federal Reserve. Analysts expect a modest slowdown in the annual rate of consumer price growth to 2.6 percent last month from 2.8 percent, driven by falling gas prices and more deflation in consumer goods. That's the lowest reading since March 2021 but remains above the Fed's 2 percent target. Federal Reserve Bank of Atlanta President Raphael Bostic said Thursday he continues to expect one interest rate cut this year in the fourth quarter as inflation shows progress. His projection echoes that of the Federal Open Market Committee. Investors may also react to the Biden-Trump Presidential debate and weigh political uncertainty risks, heading into France's landmark legislative elections due over the weekend. The first U.S. Presidential debate between President Joe Biden and former President Donald Trump has ended, with both the leaders trading fiery barbs at each other over several issues such as the state of the economy, border, foreign policy, abortion and national security. Opinion polls suggest victory for the far right in the first phase of the two-stage French parliamentary elections, but predicting the outcome of final vote on July 7 is less clear-cut, given the complexity of France's voting system. In the European trading today, the U.S. dollar rose to a 38-year high of 161.28 against the yen, nearly a 4-week high of 0.9001 against the Swiss franc and a 10-day high of 1.3735 against the Canadian dollar, from early lows of 160.65, 0.8985 and 1.3697, respectively. If the greenback extends its uptrend, it is likely to find resistance around 162.00 against the yen, 0.93 against the franc and 1.39 against the loonie. Against the euro and the pound, the greenback edged up to 1.0684 and 1.2622 from early lows of 1.0711 and 1.2650, respectively. The greenback may test resistance near 1.05 against the euro and 1.24 against the pound. Looking ahead, Canada GDP data for April, U.S. Core PCE price index for May, personal income and spending data for May, U.S. Chicago PMI for June, U.S. University of Michigan's consumer sentiment index for June and U.S. weekly Baker Hughes oil rig count data are slated for release in the New York session.