(fxcue news) - The Dollar Index firmed up during the week ended December 13 as currency markets priced in the prospect of slower-than-expected Fed rate cuts in 2025. The Dollar firmed up against the euro, the British pound and the Japanese yen. It also strengthened against the Australian dollar, the Swedish krona, the Canadian dollar and the Swiss franc. The Dollar Index, a measure of the Dollar's strength against a basket of currencies comprising the euro, the British pound, the Japanese yen, the Canadian Dollar, the Swedish Krona and the Swiss franc closed trading 0.89 percent higher at 107.00 on December 13 versus 106.06 a week earlier. The week's trading range was much wider, oscillating between the low of 105.80 recorded on Monday and the high of 107.19 recorded on Friday. Data released by the U.S. Bureau of Labor Statistics on Wednesday had showed headline annual inflation rising as expected to 2.7 percent in November from 2.6 percent in October. The core component thereof also remained steady at the 3.3 percent in line with expectations. Inflation on a month-on-month basis edged up to 0.3 percent from 0.2 percent prevailing since July, matching forecasts. The core component thereof also remained steady at the 0.3 percent level that markets had anticipated. Data released by the U.S. Bureau of Labor Statistics on Thursday showed factory gate prices in the U.S. increasing 0.4 percent month-over-month in November. The level was higher than the upwardly revised 0.3 percent in October and twice the market forecast of 0.2 percent. Meanwhile, data released by the U.S. Department of Labor on Thursday showed initial jobless claims unexpectedly jumping to 242 thousand in the first week of December. The previous week's reading was revised to 225 thousand. Markets had expected a lower level of 220 thousand. With no negative surprises on the CPI front, market expectations of a quarter-point Fed rate cut in December that would reduce the Fed's target rate to 4.25-4.5 percent firmed up to 96 percent by Friday from 85 percent on Monday. However, the sharpest count of new claims since October further deepened Fed's potential monetary policy challenges in managing the tradeoff between sticky inflation and weakness in the labor market. Considering the Fed's twin mandate of ensuring stable prices and maximum employment, the Fed is apparently gearing for a slower path of rate cuts in 2025, bolstering the Dollar. The U.S. dollar added 0.62 percent against the euro during the week ended December 13 amidst the widely expected rate cut by the European Central Bank. The ECB on Thursday cut its key interest rates by 25 bps for the fourth time this year. From the level of 1.0568 on December 6, the EUR/USD pair slipped to 1.0502 by December 13. The weekly trading ranged between the high of 1.0595 recorded on Monday and the low of 1.0453 touched on Friday. The sterling dropped 0.97 percent against the greenback during the week ended December 13 amidst data that showed the British economy unexpectedly contracted by 0.1 percent month-over-month in October. Markets had anticipated an expansion of 0.1 percent, and the shocking contraction renewed rate cut bets from the Bank of England. The GBP/USD pair slipped to 1.2618 on December 13, from 1.2742 a week earlier. The sterling's weekly trading range was between $1.2800 recorded on Monday and $1.2607 recorded on Friday. The Australian Dollar declined 0.44 percent against the greenback during the week ended December 13 despite Reserve Bank of Australia holding rates steady in line with expectations. From the level of 0.6389 recorded on December 6, the AUD/USD pair dropped to 0.6361 in a week's time. The pair touched a high of 0.6473 on Monday and a low of 0.6336 on Wednesday. The USD/ JPY pair rallied 2.41 percent during the week ended December 13 as it closed at 153.64 versus 150.03 a week earlier. The pair ranged between the low of 149.69 on Monday and the high of 153.81 on Friday as markets toned down expectations of a rate hike by the Bank of Japan. Ahead of the Federal Reserve's interest rate decision due on Wednesday, the Dollar Index has edged down to 106.97. The euro has slipped to 1.0499. Amidst speculation about whether Bank of England would ease rates to push growth, the pound sterling has increased to $1.2656. The Bank of Japan is widely seen holding rates steady in the review this week and in this backdrop, the USD/JPY pair has increased to 154.06. The AUD/USD pair has in the meanwhile weakened to 0.6358.