Forex - Dollar Spikes, Then Retreats on U.S. Inflation Data
Investing.com
Published Sep 14, 2017 09:10AM ET
Dollar spikes, then retreats on U.S. inflation data
Investing.com - The dollar briefly spiked before retreating against a basket of the other major currencies on Thursday after the latest U.S. inflation report showed that consumer prices rose in August at the fastest rate since January.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 92.3 by 09:02 AM ET (13:02 GMT) after initially rising as high as 92.51.
The consumer price index rose 0.4% in August from a month earlier, the Labor Department said, while the annual rate of inflation rose to 1.9% from 1.7% in July.
The increase was due in large part to a surge in gasoline prices in the wake of Hurricane Harvey. But signs that inflation is firming could allow the Fed to proceed with plans for a third interest rate hike this year.
Another report showed that the number of people who filed for unemployment assistance in the U.S. last week declined unexpectedly.
The dollar was a touch higher against the yen, with USD/JPY last at 110.58.
The euro was little changed, with EUR/USD at 1.1882, holding below last Friday’s two-and-a-half year highs of 1.2091.
Sterling was at one-year highs against the greenback, with GBP/USD jumping 1.14% to 1.3358 after the Bank of England indicated that interest rates could rise in the “coming months” amid accelerating inflation.
The pound was also sharply higher against the euro, with EUR/GBP dropping 1.12% to 0.8894.
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Written By: Investing.com
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