The dollar traded little changed on Friday after gains the day before, as traders scrambled at a series of interest rate hikes by central banks and grappled with the prospect that borrowing costs still have a way to rise.

The euro was flat at $1.063. On the eve it fell 0.5%, after the European Central Bank raised rates and said it is far from over, raising fears about possible damage to the global economy and prompting investors to take refuge in the greenback.

Earlier in the day, Federal Reserve Chairman Jerome Powell said monetary authorities expect rates to continue to rise and stay elevated for longer. Aggressive central bank rhetoric has traders reconsidering their bets that the pain over rate hikes could soon end, prompting a sell-off in global stocks and European bonds on Thursday and Friday.

“Yesterday saw a big episode of risk shifting, which usually benefits the dollar as a safe-haven asset,” said Alvin Tan of RBC Capital Markets. “In the short term, the market wants to sell dollars, despite yesterday’s price developments, but as we head into the new year, we think the situation could change due to slowing global growth.”

Against the yen, the greenback fell 0.54% to 137.01. However, against sterling, it gained 0.43% to $1.213.

*The Dollar Index, which compares the U.S. currency to a basket of six major currencies, was flat at 104.53 after rising more than 0.9 percent on Thursday.

The risk-sensitive Australian dollar fell 0.11 percent to $0.669 after losing 2.38 percent on Thursday, its biggest drop since March 2020.

The New Zealand dollar rose 0.17 percent to $0.635.