The dollar continued to drift higher amid a backdrop of uncertainty about just how much further US interest rates have to go. Crucially, the euro was under 1.19 usd for the first time the start of the year, while the pound slipped under 1.74 usd. "The sudden volatility underlines the frustration of the markets as uncertainty becomes more heightened about where rates may peak," said Dargh Maher at CALYON. The highlight for the week ahead will be the New Fed chairman Ben Bernanke's semi-annual testimony on monetary policy. Analysts at CALYON believe that the Fed funds rate would hit 5 pct from 4.50 pct at present -- and they contend that markets has increasingly sharing this view. "With the Fed still concerned about the inflation threat from rising resource utilisation rates in the labour and product market, Bernanke will likely endorse this view," added Maher. He believes this relatively hawkish tone will sit well with the data releases this week which include an expected surge in US retail sales which may well contribute to a rebound in first quarter GDP growth. More strong US data is expected this week. The Philly Fed consumer confidence index is expected to gain ground in the preliminary reading for January. While all these bode well for the dollar, its rally of late suggests much may already be in the price, added Maher. The dollar also gained on the yen with one dollar buying just over 118 yen. However, continued speculation about the possibility of policy tightening from the Bank of Japan helped the yen stay well-bid. In the UK, a rise in producer prices helped lift the pound slightly. In data just out it was revealed that rises in crude oil and metal prices caused input prices to jump in January, while output price growth picked up to a four month high as manufacturers passed on some of these price gains. The office of National Statistics said input prices rose by 1.8 pct in January from December on a seasonally adjusted basis, well above analysts' expectations for a more moderate rise of 1.3 pct. Meanwhile, between December and January, output prices, on a non-adjusted basis, rose by 0.4 pct -- the biggest monthly gain since September last year -- after a 0.2 pct drop in December