Dollar trims losses vs. rivals after U.S. inflation data

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Dollar eases off session lows after data but remains on the downsideDollar eases off session lows after data but remains on the downside

Investing.com – The dollar trimmed losses against a basket of other major currencies on Friday, but remained under pressure after the release of tepid U.S. inflation data and as investors still eyed an upcoming report on U.S. consumer sentiment.

The U.S. Bureau of Labor Statistics said that consumer prices rose 0.2% last month, confounding expectations for an increase of 0.3%, after a 0.2% uptick in February.

Year-on-year, U.S. consumer prices fell 0.1% in March, compared to expectations for a 0.1% rise, after a flat reading the previous month.

Core consumer prices, which exclude food and energy, rose 0.2% last month, in line with expectations and after a 0.2% gain in February.

The report came after a string of disappointing U.S. data published throughout the week fuelled speculation that the Federal Reserve could delay hiking interest rates until late 2015, instead of tightening midyear.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.20% to 97.68.

EUR/USD was up 0.24% to 1.0787 after revised data showed that euro zone consumer price inflation rose 1.1% last month, in line with expectations and up from a preliminary estimate of 0.6%. Euro zone inflation declined by 0.3% in February.

The rate grew closer to the European Central Bank’s target of near but just below 2%.

Core CPI, which excludes food, energy, alcohol, and tobacco costs rose 1.4% in February, up from an initial estimate of 0.6%.

The pound was also higher, with GBP/USD up 0.50% to 1.5010, even as the Office for National Statistics said that the U.K. claimant count dropped 20,700 last month, compared to expectations for a 29,500 decline.

A separate report showed that the U.K. unemployment rate ticked down to 5.6% in February from 5.7% the previous month, in line with expectations.

In addition, data showed that average U.K. earnings rose 1.7% in February, below expectations for an increase of 1.8%, after an upwardly revised 1.9% gain in January.

Elsewhere, the dollar was steady against the yen, with USD/JPY at 119.01 and lower against the Swiss franc, with USD/CHF shedding 0.35% to 0.9529.

The Australian dollar was little changed, with AUD/NZD at 0.7805 and the New Zealand was higher, with NZD/USD up 0.33% to 0.7695.

Meanwhile, USD/CAD dropped 0.80% to trade at 1.2091 after data showed that Canada’s retail sales rose 1.7% in February, beating expectations for a 0.2% gain and after a revised 1.4% decline the previous month.

Core retail sales, which exclude automobiles, rose 2.0% in February, more than the expected 0.5% rise, after a revised 1.5% drop the previous month.

Data also showed that Canadian consumer prices ticked up 0.7% last month, compared to expectations for an increase of 0.5%, after 0.9% rise in February.

Core consumer prices, which exclude the eight most volatile items, rose 0.6% in March, exceeding expectations for a 0.3% gain, after a 0.6% increase the previous month.



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