NEW YORK (Reuters) - The U.S. dollar climbed on Friday to its highest level since 2003 on continued bets on faster inflation and higher interest rates, while Treasuries resumed a selloff that left benchmark yields on track to post their steepest two-week increase in 13 years.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, NY, U.S. November 18, 2016. REUTERS/Brendan McDermid

A growing perception that the economic policies of U.S. President-elect Donald Trump will lift consumer prices pushed the dollar higher, weighing on crude and other commodities.

On Wall Street, the tech- and biotech-heavy Nasdaq Composite hit a record intraday high before slipping lower. The Dow industrials and S&P 500 were also near record highs despite the day’s decline.

“I think given the major indexes are at or near all-time highs, we’re probably due for a little bit of a digestion period,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management.

“Equities are generally expected to move sideways until we get a little more of visibility into what some of the policies are going to be with the new administration.”

The Dow Jones industrial average .DJI fell 39.48 points, or 0.21 percent, to 18,864.34, the S&P 500 .SPX lost 5.55 points, or 0.25 percent, to 2,181.57 while the Nasdaq Composite .IXIC dropped 14.15 points, or 0.27 percent, to 5,320.83.

The pan-European FTSEurofirst 300 index .FTEU3 fell 0.54 percent, while MSCI's gauge of stocks across the globe .MIWD00000PUS fell 0.49 percent.

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Emerging market stocks fell 0.2 percent and remained near a four-month low hit Monday.

The U.S. dollar's rise against the yen JPY= raised hopes of an earnings boost to Japanese exporters, helping lift the Nikkei average .N225 to a 10-month high. The blue-chip Japanese stock index closed 0.6 percent higher.

BOND SELLOFF RESUMES, GREENBACK FLIES

Last week’s unexpected U.S. election victory from political neophyte Donald Trump has led to a repricing of assets, most notably in currency and bond markets.

Federal Reserve policymaker James Bullard said on Friday he is leaning toward supporting a rate rise in December, adding that a plethora of potential changes under Trump could affect future policy.

The euro EUR= fell 0.3 percent to $1.0594, while the yen JPY= weakened to 110.51, having earlier fallen to 110.92 per dollar. Against the Chinese yuan, the greenback hit 6.895 CNY=CFXS, its highest since mid 2008.

The dollar index .DXY hit a high of 101.48, its highest level since April 2003. It has risen over 4 percent in the last two weeks, its biggest fortnightly rise since March 2015.

The 10-year U.S. Treasury yield US10YT=RR rose to 2.355 percent, its highest since December. It is up about 51 basis points over the last two weeks - the biggest such rise in 13 years. Benchmark 10-year notes US10YT=RR last fell 14/32 in price.

U.S. crude CLc1 last fell -0.2 percent to $45.50 a barrel and Brent LCOc1 traded at $46.60, down -0.2 percent on the day.

Spot gold XAU= fell 0.6 percent to $1,208.92 an ounce. U.S. gold futures GCcv1 fell 0.7 percent to $1,208.60 an ounce.

Copper CMCU3 fell 0.9 percent to $5,444.00 a ton.