US Inflation

The Dollar ceded ground to Pound Sterling while paring gains over the Euro Tuesday after December's inflation figures surprised on the downside, although losses are likely to be limited because price pressures are thought to be sufficient to prevent the Federal Reserve (Fed) from cutting interest rates again. 

The Dollar pared gains over many rivals in the noon session after official data revealed a surprisingly strong increase in inflation last month although its the looming Federal Reserve (Fed) interest rate decision and guidance that matters most on Wednesday to the outlook for weeks ahead. 

The Dollar built on earlier gains Wednesday after inflation figures surprised on the upside for the month of October and as investors eschewed risky prospects amid fresh unease over White House trade policy in the wake of President Donald Trump's speech to The Economic Club of New York. 

The Dollar rose modestly in noon trading Tuesday after official data revealed a surprise increase in inflation for June, which could limit the extent to which the Federal Reserve (Fed) is willing to further reduce its interest rate during the months ahead.

The Dollar drew support Thursday from official figures that showed inflation rising faster than was expected during June, potentially leading some investors to conclude that elevated consumer price pressures could prevent the Federal Reserve (Fed) from cutting its interest rate as much as markets expect. 

The Dollar extended earlier gains during noon trading Wednesday even after official inflation figures for the month of May surprised on the downside, although the miss was miniscule when compared with the extent to which markets have become pessimistic in their outlook for Federal Reserve (Fed) interest rate policy. 

The Dollar weakened a fraction further against the Pound after the release of U.S. inflation data for April on Friday, as the lower-than-expected readings did little to improve the outlook for Federal Reserve interest rate policy.

The greenback capitulated at range highs before slipping lower on Tuesday after inflation data surprised on the downside for the month of February, vindicating investors for having bet earlier this year that an end to the Federal Reserve (Fed) interest rate hiking cycle is nigh. 

The Dollar rose broadly on Wednesday after official data showed inflation pressures remaining elevated early in the New Year and as markets responded positively to President Donald Trump's suggestion that he might be willing to give negotiators more time to end the U.S.-China trade war. 

The Dollar slumped Friday following the latest commentary from Federal Reserve (Fed) policymakers and after inflation data voiced support for the bank's new narrative that it can afford to be "patient" before hiking U.S. interest rates again. 

The U.S. Dollar appeared to shrug Wednesday when official data revealed that U.S. inflation pressures remained elevated during October, although recent developments in oil markets mean the outlook for price pressures has cooled of late.

The Dollar extended losses Thursday after official data revealed a surprisingly sharp fall in inflation during September, which places a question mark over the extent to which price pressures will compell the Federal Reserve (Fed) to keep raising interest rates over coming months.

The Dollar handed back previous gains to be seen swathed in red Thursday after inflation data surprised on the downside for August, reinforcing an earlier downward bias arising from signs of a fresh detente in the US "trade war" with China.

Champagne corks could be heard popping in Washington today after data showed US inflation finally clawed its way back above a landmark level.

The US Dollar surprised commentators mid-week by falling despite rising US inflationary rates. What is going on and what does it mean for key US Dollar-based exchange rates?

GBP/USD sold off after the release of January US inflation data showed price gains held onto their strong growth rate at the start of 2018.

Treasury yields and the Dollar were both lower overnight after the Fed left markets underwhelmed.

The release of important economic data in the US later today has the potential to impact on Dollar pairs as it may influence expectations about US monetary policy, which is a major driver of exchange rates.

Markets have been pricing a near 80% chance of a Federal Reserve rate hike in December, despite persistent downward pressure on inflation. Friday's data could mean markets may now begin to question the wisdom of the Fed going ahead with a rate hike.