# Dollar dips ahead of inflation data later this week
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-04-11
Category: TRADING
Category URL: https://financedigest.com/category/trading
Meta Title: Dollar Falls as Investors Await US Inflation Data
Meta Description: Get the latest on the dollar's performance as inflation data looms. Stay informed on Federal Reserve rate hikes and market expectations.
URL: https://financedigest.com/dollar-dips-ahead-of-inflation-data-later-this-weekhtml

![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2023-04-11t014700z1lynxmpej3a01ertroptp4global-forex-1736814172252-compressed.jpg)

By Karen Brettell

NEW YORK (Reuters) – The dollar fell on Tuesday as investors waited on inflation data for further signs of whether price pressures are ebbing and what it means for further Federal Reserve interest rate hikes.

Consumer price data on Wednesday is expected to show headline inflation rose by 0.2% in March, while core inflation rose 0.4%.

A lot of traders are focused on this [inflation data,”](https://www.financedigest.com/european-shares-rise-as-us-inflation-data-signals-end-of-rate-hike-cycle.html "European shares rise as US inflation data signals end of rate-hike cycle") said Edward Moya, senior market analyst at OANDA in New York. “Everyone’s trying to get a sense of does the disinflation process return and does this complicate what the Fed does.”

The Fed is seen as likely to [hike rates](https://www.financedigest.com/dollar-firms-after-u-s-labor-data-suggests-more-rate-hikes.html "Dollar firms after U.S. labor data suggests more rate hikes") by an additional 25 basis points at its May 2-3 meeting, before pausing in June. Markets are also pricing for the Fed to cut rates by year-end on an expected recession, though Fed officials have stressed the [need to keep rates high in order to bring down inflation](https://www.financedigest.com/bank-of-england-still-needs-to-see-the-job-through-on-inflation-pill.html "Bank of England still needs to ‘see the job through’ on inflation: Pill").

Strong [jobs data](https://www.financedigest.com/stocks-mixed-dollar-gains-after-robust-inflation-jobs-data.html "Stocks mixed, dollar gains after robust inflation, jobs data") for March have added to expectations that the U.S. central [bank will complete one more rate](https://www.financedigest.com/bank-of-england-officials-split-over-future-path-for-rates.html "Bank of England officials split over future path for rates") hike. The data on Friday showed employers added 236,000 [jobs while the unemployment rate](https://www.financedigest.com/italy-jan-jobless-rate-edges-up-to-7-9-with-35000-jobs-created.html "Italy Jan jobless rate edges up to 7.9%, with 35,000 jobs created") fell to 3.5%.

The dollar index fell 0.36% to 102.08. The [euro gained](https://www.financedigest.com/dollar-trims-gains-vs-euro-after-u-s-inflation-data.html "Dollar trims gains vs euro after U.S. inflation data") 0.52% to $1.0918.

The [euro was also likely boosted by a rise in European](https://www.financedigest.com/dollar-outshines-euro-sterling-amid-european-bank-jitters.html "Dollar outshines euro, sterling amid European bank jitters") bond yields on Tuesday as traders in the region returned after markets were closed on Friday and Monday for the Easter holiday.

Algorithms [trading currencies](https://www.financedigest.com/currency-trading-in-a-spin-after-polish-explosion.html "Currency trading in a spin after Polish explosion") based on the difference between European and U.S. rates might have sold [euros for dollars](https://www.financedigest.com/pound-hits-10-month-peak-euro-up-as-dollar-under-pressure.html "Pound hits 10-month peak, euro up as dollar under pressure") when U.S. Treasury [yields rose after the jobs data](https://www.financedigest.com/stocks-yields-fall-data-suggests-u-s-economy-cooling.html "Stocks, yields fall; data suggests U.S. economy cooling") while European bond markets were closed, said Simon Harvey, head of FX analysis at Monex Europe.

European [bond yields](https://www.financedigest.com/stocks-fall-bond-yields-rise-as-focus-shifts-to-fed-rate-outlook.html "Stocks fall, bond yields rise as focus shifts to Fed, rate outlook") rose sharply on Tuesday, catching up after the break. GVD/EUR

“There’s just that catch-up effect flushing through,” Harvey said.

The dollar also slid against the yen, after jumping on Monday as Bank of Japan [Governor Kazuo Ueda](https://www.financedigest.com/japanese-yen-gains-as-ueda-set-to-be-named-next-boj-governor.html "Japanese yen gains as Ueda set to be named next BOJ governor") signaled no hurry to dial back its massive stimulus. The [dollar was last down 0.33% against the Japanese currency](https://www.financedigest.com/u-s-dollar-advances-vs-major-currencies-as-risk-appetite-fades.html "U.S. dollar advances vs major currencies as risk appetite fades") at 133.16.

In cryptocurrencies, bitcoin breached the [key $30,000 level for the first time in 10 months](https://www.financedigest.com/inflation-in-key-german-states-eases-for-second-month.html "Inflation in key German states eases for second month"). It was last up 1.8% on the day at $30,184.

========================================================

Currency bid prices at 9:34AM (1334 GMT)

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Dollar index 102.0800 102.4700 -0.36% -1.362% +102.5100 +102.0000

Euro/Dollar $1.0918 $1.0861 +0.52% +1.89% +$1.0926 +$1.0862

Dollar/Yen 133.1600 133.6000 -0.33% +1.56% +133.6800 +132.9700

Euro/Yen 145.38 145.08 +0.21% +3.62% +145.4300 +144.8800

Dollar/Swiss 0.9052 0.9096 -0.49% -2.12% +0.9093 +0.9038

Sterling/Dollar $1.2435 $1.2384 +0.44% +2.84% +$1.2456 +$1.2388

Dollar/Canadian 1.3501 1.3509 -0.05% -0.35% +1.3516 +1.3483

Aussie/Dollar $0.6662 $0.6642 +0.28% -2.29% +$0.6680 +$0.6640

Euro/Swiss 0.9882 0.9876 +0.06% -0.13% +0.9885 +0.9853

Euro/Sterling 0.8778 0.8768 +0.11% -0.75% +0.8784 +0.8764

NZ $0.6210 $0.6217 -0.13% -2.21% +$0.6233 +$0.6199

Dollar/Dollar

Dollar/Norway 10.5760 10.5260 +0.52% +7.82% +10.6010 +10.4690

Euro/Norway 11.5432 11.4231 +1.05% +10.06% +11.5737 +11.4052

Dollar/Sweden 10.4531 10.5212 -0.16% +0.44% +10.5166 +10.4436

Euro/Sweden 11.4085 11.4267 -0.16% +2.38% +11.4412 +11.3920

(Reporting by Karen Brettell; Additional reporting by Alun John in London; Editing by Alexander Smith)


---
This blog is powered by Superblog. Visit https://superblog.ai to know more.
---