The dollar declined on Thursday, with weaker-than-forecast US consumer inflation data making traders even more uncertain about when the Federal Reserve will launch interest rates hikes. The dollar index was down 0.50 percent in a second day of losses since the Fed on Wednesday trimmed economic growth forecasts and gave no clear signal on when it will hike interest rates for the first time in nearly a decade.
Jumps in gasoline prices helped lift the US Consumer Price Index 0.4 percent last month after it rose 0.1 percent in April, according to the Labour Department. But the rise was shy of forecasts. So-called core CPI, which strips out food and energy costs, increased 0.1 percent, the smallest rise since December, after advancing 0.3 percent in April.
"The market was looking for blow-out numbers and didn't get them," said Kathy Lien, managing director of FX strategy for BK Asset Management in New York. "The market continues to be disappointed by yesterday's FOMC rate decision." The dollar was last off against the euro by 0.55 percent at $1.14, a level not seen in a month. Sterling added to recent gains against the dollar, rising to a seven-months high of $1.5930 on Thursday, after rising sharply on Wednesday with better than expected British wage growth.
The Swiss franc rose after the Swiss National Bank kept interest rates unchanged at -0.75 percent and slightly tweaked its inflation forecasts. The dollar was last off 0.50 percent against the franc at 0.9180 francs. The Norwegian crown fell sharply after Norway's central bank cut rates and left the door open for another reduction in September. The dollar was up 1 percent to trade at 7.74 crowns.
Comments
Comments are closed.