LONDON/SYDNEY, Sept 9 (Reuters) – The euro rose back above parity to a two-week high against the dollar on Friday following a large rate hike and hawkish comments from the European Central Bank, while a weaker dollar helped world stocks rise to a one-week high. The euro was plotting 1.5% gains for the week after the ECB raised rates by a record 75 basis points on Thursday and signalled further hikes to fight inflation, even as the bloc’s economy is likely heading for a winter recession. Meanwhile, Federal Reserve Chair Jerome Powell said on Thursday the bank is “strongly committed” to controlling inflation but hopes it can do this without the “very high social costs” involved in past inflation fights. “We have seen more hawkish comments out of central banks not only in the U.S. but globally – the Bank of England and the ECB,” said Matthias Scheiber, global head of portfolio management for multi-asset solutions at Allspring. “You can see it in short-term interest rates.” The euro jumped 1% to $1.0102 as Germany’s two-year bond yield leapt 9 basis points to 1.417%, hitting its highest since 2011 for a second day. “A further 75bp rate step is quite possible for the October (ECB) meeting, as inflation is likely to rise further for now,” Commerzbank analysts said in a note. The dollar stumbled 0.95% against a basket of major currencies. Sterling rose 1.1% against the dollar after Britain’s new leader, Liz Truss, on Thursday announced a cap on soaring consumer energy bills for two years to cushion the economic shock of the war in Ukraine. “There is still a lot of tightening to come, but I guess the Fed is getting closer to the top, so we will probably see some easing in the pace of hikes, if not in this month’s meeting, maybe in the subsequent meetings,” said Shane Oliver, head of investment strategy and chief economist at AMP Capital. NN: