Dollar falls as US inflation data cools rate hike fears
By Aboki Forex —
The U.S. dollar weakened on Thursday, snapping a three-day winning streak. Fresh economic reports from the United States, including the latest inflation numbers, reduced expectations that the Federal Reserve will push ahead with aggressive rate hikes this year.
Inflation remained high, but the data broadly matched market forecasts. Investors responded by scaling back bets on near-term monetary tightening. The U.S. Commerce Department released the Fed's preferred inflation gauge, the PCE price index. It rose in line with economists' predictions. On a monthly basis, the index also increased as expected.
The softer inflation reading eased pressure on the Fed to act quickly. That sent the dollar lower against major currencies. Traders now watch for further economic signals to gauge the next move from the central bank.