NEW YORK (CNN/Money) - The dollar hit a five-month high against the yen and rose versus the euro Monday amid speculation that this week's economic reports will be strong enough to spur faster interest rate hikes.

But Treasury dealers turned defensive ahead of the upcoming reports on inflation and the job market, sending the yield on the 10-year note to an eight-month high.

In currency trading, the dollar bought ¥107.20, up from ¥106.36 late Friday. Technical analysts told Reuters that the greenback's break above resistance at ¥106.86 during Asian trading hours acted as a springboard for the dollar, and could allow it to climb higher on the yen in the days ahead.

The euro bought $1.2892, down from $1.2953 late Friday. The currency fell to a six week low against the dollar earlier in the day at $1.2871.

Traders are betting a number of economic reports due this week -- including the March jobs report, the final reading on fourth-quarter gross domestic product and an inflation indicator watched by the Federal Reserve -- will prompt the Fed to raise interest rates further and faster in the face of an expanding economy and rising inflation.

"The dollar has benefited from the view that the Fed will raise interest rates at a more aggressive pace. Certainly, I think this week's economic numbers will support this view," Omer Esiner, market analyst at Ruesch International, told Reuters.

The Fed noted a pick-up in inflation in the statement accompanying its policy meeting last week, causing the market to price in higher interest rates. This move helped the dollar as higher rates generally make dollar-denominated securities more attractive to foreign investors.

"Given the current sentiment in the market, there's probably a greater chance of the dollar rallying on a strong number than the risk of any sort of sell-off if there is disappointment," Junya Tanase, a currency strategist at J.P. Morgan Chase in Tokyo, told Reuters.

In Treasuries, the 10-year note lost 10/32 of a point, to 94-30/32, to yield 4.64 percent, up from 4.60 percent late Thursday. The bond market was closed for Good Friday. The last time the yield on the 10-year touched 4.64 percent was July 2004.

The 30-year bond fell 21/32 of a point to 107-3/32, to yield 4.88 percent, up from 4.84 percent late Thursday. Bond prices and yields move in opposite directions.

The five-year note lost 2/32 of a point to yield 4.33 percent, while the two-year slipped one tick to yield 3.87 percent.

Last week's bearish tone persisted as more investors priced in an aggressive stance on monetary policy from the Federal Reserve.

"I suspect that interest rates must increase considerably more than is currently expected or has been built into forward markets," Charles Lieberman, chief investment officer at Advisors Capital Management, told Reuters.

For how faster interest rate hikes would impact you, click here.