By Josie Cox and Anjani Trivedi 

The U.S. dollar has been climbing for nine weeks, marking its longest rally in 17 years, spurred by expectations that the Federal Reserve could raise interest rates next year, in a divergence from other major central banks that are still in easing mode.

The ICE U.S. Dollar Index, which measures the dollar's strength against six major currencies, hit 84.519 on Friday. The previous nine-week period of gains occurred between December 1996 and February 1997.

"We see potential for dollar strength to broaden out, particularly if the Fed surprises markets with less dovish forward guidance next week," Morgan Stanley strategists write in a note.

"The dollar is not just the best performing developed world currency on a five-day view, but it can currently claim to be the best performer on both a one-month and three-month view also," said Jane Foley, currency strategist at Rabobank in London.

Ms. Foley said the dollar is being spurred by positive U.S. economic data, but also by the European Central Bank, which last week decided to push its deposit rate further into negative territory.

"On the relative basis, the ECB action has made the carry offered by the U.S. dollar more attractive," she said.

Growth in the U.S. has outpaced much of the rest of the developed world, fueling expectations for the Fed to raise interest rates, while the ECB and Bank of Japan remain firmly in easing mode.

Bank of America Merrill Lynch chief economist Ethan Harris, in a note Friday, said he now expects a Fed rise in June next year, earlier than his previous forecast for September 2015, citing forecast-beating gross domestic product data as well as stronger than anticipated inflation.

GDP, considered the broadest measure of goods and services produced across the economy, grew at a seasonally adjusted annual rate of 4.2% in the second quarter.

The bank said that buying the dollar "is the best way to position" for what will be the first rate rise in the U.S. since 2006.

Higher interest rates would boost the U.S. dollar as investors seek the increased return promised by dollar-denominated assets.

On Thursday, the U.S. dollar hit a seven-month high against the New Zealand dollar, a five-month high against the Australian dollar, as well as a six-month high against the yen, after Bank of Japan Governor Haruhiko Kuroda said the bank was prepared to loosen monetary policy or take other steps, if necessary, to meet the county's inflation target.

The dollar has also gained traction against the British pound in recent weeks, despite the Bank of England also moving toward lifting interest rates, helped by sterling coming under pressure amid uncertainty ahead of the Scottish referendum scheduled to take place next week.

Write to Josie Cox at josie.cox@wsj.com and Anjani Trivedi at anjani.trivedi@wsj.com

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