Title: Dollar Recovers Some Losses After Inflation-Driven Drop
Aug 11, 2022 03:14AM ET
On Thursday, the dollar made up some of its losses after a sharp decline the previous day due to softer-than-expected US inflation data.
The dollar index, which measures the greenback's value against a range of other world currencies, was trading 0.08% higher at 105.28 as of 02:47 GMT.
Key Data the U.S. Consumer Price Index rose 8.5% on an annual basis in July and was unchanged from June, missing forecasts of 8.7% and 0.2% due in part to a drop in gasoline costs. The print has led some investors to revise their expectations for a Federal Reserve rate hike in September, with the CME's Fedwatch tool now seeing the hike as 50 basis points instead of 75 basis points.
Fed policymakers also warned that rate hikes will continue until inflationary pressures subside.
The Fed's aggressive tightening of monetary policy to suppress rapid price increases has been at the heart of the dollar's recent strengthening as traders seek the relative safety of the currency amid concerns that rising interest rates could affect broader economic growth.
The dollar hit a one-month low following the release of inflation data.
At the same time, EUR/USD has retreated slightly from its biggest daily percentage gain since mid-June, with the common European currency now trading up 0.16% at $1.0313.
The Japanese yen fell 0.11% against the dollar to 132.70 yen after Wednesday's 1.6 cline.
Moreover, AUD/USD, another gauge of risk appetite, rose 0.27% to $0.71, while GBP/USD held almost steady at $1.22.
Moreover, bitcoin rose 7.04% to $24,553.4, nearing a two-month high for the cryptocurrency.