(fxcue news) - The U.S. dollar extended gains against most of its major counterparts on Friday amid bets interest rates will stay mostly higher during the upcoming term of Donald Trump as his policies are likely to elevate upside risks to inflation and push rates higher. Trump has proposed tax cuts and tariffs on imported goods in his election campaign. On Thursday, the Federal Reserve lowered the interest rate by 25 basis points. In his post meeting press conference, Fed Chair Jerome Powell stressed that rates are not on "any preset course" and that the central bank will make future decisions "meeting by meeting" to deal with the risks to both sides of the dual mandate. However, with Trump returning to power, expectations of further interest rate cuts in 2025 have come down a bit. In economic news today, preliminary data released by the University of Michigan showed consumer sentiment has improved by more than expected in the month of November. The University of Michigan said its consumer sentiment index climbed to 73.0 in November from 70.5 in October. Economists had expected the index to inch up to 71.0. With the bigger than expected increase, the consumer sentiment index reached its highest level since hitting 77.2 in April. On the inflation front, the report said year-ahead inflation expectations slipped to 2.6% in November from 2.7% in October, hitting the lowest level since December 2020. Long-run inflation expectations, on the other hand, inched up to 3.1% in November from 3% in October, remaining modestly elevated relative to the range of readings seen in the two years pre-pandemic. The dollar index climbed to 105.21 and despite paring some gains subsequently, remained firm at 104.95, up more than 0.4% from the previous close. Against the Euro, the dollar firmed to 1.0719 from 1.0804, and against Pound Sterling, it strengthened to 1.2918 from 1.2987. Against the Japanese currency, the dollar weakened to 152.62 yen from Thursday's closing value of 152.94 yen. The dollar firmed against the Aussie to 0.6583 from 0.6681. The Swiss franc drifted lower against the greenback to 0.8755, while the Loonie weakened to 1.3914 a unit of greenback.