Dollar slips as in-line CPI tempers rate-hike bets
On August 12, the U.S. dollar experienced a slight decline amid expectations of a slower Federal Reserve rate hike. In July, the consumer price index (CPI) rose by 3.4% over the past year, compared to 3.5% in June. Core CPI also increased by 2.5% in July, up from 2.6% in June. Traders have adjusted their expectations for a September rate hike, from 44% to 40%, following a jobs report showing unexpected job losses in July.
Marc Chandler, chief market strategist at Bannockburn Global Forex, noted that the dollar remained firm despite soft CPI data, suggesting a potential shift in expectations. The dollar index rose 0.17% to 99.98, while the euro fell 0.14% to $1.1524. Moving forward, markets will focus on producer price inflation data and retail sales figures released on Thursday and Friday.
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