The US dollar index was up 0.2% at 102.40 after rising 0.4% on Wednesday. (Freepik pic)

LONDON: The US dollar rose towards its strongest level in 18 months on Thursday, after minutes from the US Federal Reserve signalled policymakers viewed inflation as the biggest risk to their outlook, while higher oil prices and rising euro zone bond yields have weighed on the euro.

The global bond selloff has been the dominant driver in currency markets in recent weeks, with yields rising again on Thursday as oil prices jumped.

The widening gap in yields between German bonds and those of more indebted countries in the euro zone, such as France and Italy, has pushed the euro to its lowest level since May last year.