Dollar steadies ahead of crucial inflation report
The US dollar steadied Wednesday ahead of key inflation data that could guide future Federal Reserve policy, after relatively hawkish comments from Fed Chair Jerome Powell.
At 04:15 ET (09:15 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, traded marginally higher at 107.875, after recording some overnight losses, as traders stepped back from a tariff-driven rally in the greenback.
Dollar steadies ahead of US CPI
The day’s main focus will be the publication of a key monthly reading of U.S. inflation later in the session, which could factor into how the Fed approaches monetary policy decisions this year.
Economists expect headline consumer prices grew at a rate of 2.9% year-on-year in January, matching December's pace, while the gauge is tipped to slow to 0.3% from 0.4% on a monthly basis.
The so-called core measure, which strips out volatile items like food and fuel, is seen slowing slightly to 3.1% from 3.2%, but quickening to 0.3% from 0.2% month-on-month.
This will be the last inflation reading before any direct impact from President Donald Trump's tariff measures, which went into effect this month.
In Europe, EUR/USD traded 0.1% higher to 1.0371, bouncing from last week’s more than two-year low despite data showing Italian industrial production fell a hefty 3.1% on the month in December.
GBP/USD edged higher to 1.2443, after bouncing on Tuesday in the wake of the sharp losses that followed the Bank of England cutting interest rates last week.
In Asia, USD/JPY climbed 0.8% to 153.68, with the Japanese yen weakening sharply after hitting a near two-month high last week.
Source: Investing.com
