© Reuters. The dollar fell on Thursday.
Investing.com – The U.S. dollar slumped against other currencies on Thursday after data showed inflation pressures are easing.
Consumer prices in the U.S. rose less than expected in August, increasing 0.2% compared to expectations for a gain of 0.3%.
The inflation numbers came just a day after data showed the producer price index fell 0.1% last month, increasing concerns that the Federal Reserve could ease its hawkish stance.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.35% to 94.49 as of 10:15 AM ET (14:15 GMT).
Meanwhile, the euro and sterling rallied after the Bank of England and European Central Bank kept rates steady.
The ECB kept its deposit rate at -0.40% and repeated that it expects its asset purchase program to end in December after halving it to €15 billion per month starting in October, from €30 billion at present. The BOE kept its interest rate at 0.75%, as expected.
The EUR/USD jumped 0.52% to 1.1685, while the GBP/USD rose 0.45% to 1.3101.
The Turkish lira rose after the country’s central bank raised interest rates more than expected, with USD/TRY down 2.81% to 6.1646. The bank’s increase came after Turkish President Tayyip Erdogan issued an order limiting the use of foreign currency in domestic transactions, prompting a fall in the currency.
Elsewhere, the dollar rose against the safe-haven yen, with USD/JPY increasing 0.43% to 111.73. The Australian dollar was higher, with AUD/USD up 0.67% to 0.7215, while NZD/USD rose 0.26% to 0.6578.
Forex – U.S. Dollar Slumps on Inflation Data
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