U.S. Dollar Stabilizes Ahead of CPI Release, Sterling Weakens on Benign Inflation Data
The U.S. dollar steadied Wednesday after weakening overnight, with the Dollar Index slipping to 102.277 at 05:25 ET (09:25 GMT) against a basket of six other currencies. The currency retreated Tuesday after softer-than-expected July PPI data, leading traders to anticipate a 50 basis point cut in September.
Analysis:
The U.S. CPI release is crucial for the Federal Reserve’s rate decision. A benign CPI print could signal more risk-on trading and a potential rate cut in September.
Sterling Slips After UK Inflation Release
In Europe, the pound traded lower at 1.2837 following below-forecast British inflation data. The BoE might consider another rate cut as inflation remains below target.
Kiwi Dollar Slumps After Rate Cut
In Asia, the New Zealand dollar fell after a rate cut by RBNZ. Market expectations suggest further rate reductions, impacting currency performance.