Over the weekend, San Francisco Federal Reserve Bank President Mary Daly said that if data on inflation and the labor market continues to come in hotter than expected, interest rates will need to go higher, and stay there longer, than Fed policymakers projected in December, as reported by Reuters.

"If the momentum in the economy is reaccelerating, and inflation is moving off of its disinflationary trend and into a period of accelerating inflation, then I'm prepared to do more in terms of the level of the interest rates that will be necessary to really bring us to price stability," Daly told reporters after a speech.

Her comments come ahead of the Federal Reserve's chairman, Jerome Powell, who will speak this week and Friday's Nonfarm Payrolls. Her comments are gearing up the market for hawkish rhetoric from Powell and a solid outcome in the jobs data. 

"More is likely to be needed, and for a longer period of time," she said.

However, as Reuters reported, she said ''that to return to raising rates by bigger increments as the Fed did last year, instead of the quarter-point-a-meeting pace now expected, she would need to be very certain of how high rates will need to go. She said she is less certain now than she was last year,'' Reuters added. 

US Dollar update

The US Dollar index, DXY, which measures the greenback's value against six major currencies, fell 0.4% to end Friday at 104.527. The index made a low of 104.485, losing ground from a high of 105.36 at the start of the week, its strongest level since Jan. 6.