The dollar rose to the highest in eight months versus the euro as an increase in short-term U.S. Treasury yields signaled mounting speculation that Federal Reserve Chair Janet Yellen will need to raise interest rates.

The greenback extended gains after U.S. consumer prices rose in June, adding pressure on the Fed to tighten policy sooner, while the European Central Bank has introduced unprecedented stimulus. Indonesia’s rupiah weakened from a two-month high as a presidential candidate rejected the election as undemocratic. Russia’s ruble headed for the strongest gain in a month.

“That’s not a data response, that is a market that’s looking to sell euro,” Greg Anderson, head of global foreign-exchange strategy at Bank of Montreal, said by phone from New York. The U.S. data was “not much of a surprise, just tiny bit soft on the core.”

The dollar appreciated 0.3 percent to 1.3480 per euro at 8:47 a.m. New York time, after touching $1.3459, the strongest level since Nov. 21. The euro fell 0.3 percent to 136.73 yen. The Japanese currency was little changed at 101.43 per dollar.

The Bloomberg Dollar Spot Index, which tracks the U.S. currency against 10 major counterparts, rose 0.1 percent to 1,010.45 after advancing to 1,011.76, the highest level since June 18.

The consumer price index increased 0.3 percent after a 0.4 percent gain the prior month, matching the median forecast of 85 economists surveyed by Bloomberg, figures from the Labor Department showed today in Washington. The core measure, which excludes volatile food and fuel costs, increased 0.1 percent, less than projected.

“More evidence of higher inflation in the U.S. would be seen as positive for the dollar as long as it leads to a pickup in short-term U.S. yields,” Lee Hardman, a foreign-exchange strategist at Bank of Tokyo-Mitsubishi UFJ Ltd. in London, said before the data. “If higher inflation persists, it will challenge Yellen’s dovish view that this is just a temporary phenomenon. The contrast is becoming more notable between ECB and Fed policy.”