On Friday, the Dollar rocketed and Euro managed to slip to hit a nine-month low, as a direct result of the Federal Reserve announcing that it was all set to raise the interest rate that it charges banks for emergency loans, igniting expectations that it is inching towards bringing monetary policies to a normal level again.

As was announced by the Fed, the discount rate would be lifted from 0.50% to 0.75%, starting Friday, although it did not change the benchmark funds rates and left them at a near-zero level.

After rising to hit its highest level in 8 long months, the Dollar index managed to settle down after the Fed confirmed that the development is not a precursor to a hike in the benchmark rate.

"The dollar will likely extend gains gradually on market expectations for further moves by the Fed towards normalization of monetary policy. But it will take more time before there is a hike in the fed funds rate as there need to be improvements in the U. S. economy, such as in the labour market", said Tomohiro Nishida, Treasury Department Manager at Chuo Mitsui Trust and Banking.

The Dollar index, which is the gauge of the American currency's performance against 6 major world currencies, hiked by 1% to 81.16.