Dollar slips after 18-month high as Fed hike bets cool
In short
The dollar fell after reaching an 18-month high. It had risen on hotter inflation data, but comments from Federal Reserve officials made traders less sure about an October rate hike.
The drop came as Treasury yields eased. Investors are now waiting for US producer price and retail sales data, but it is not clear what happens next.
What the reporting says
The dollar fell from an 18-month high after stronger-than-expected inflation data had first pushed it up, then Federal Reserve officials tempered expectations for an October rate hike. The move came alongside lower Treasury yields, and the currency weakened against the euro and sterling. Traders are now watching upcoming US producer price and retail sales figures, but the reporting does not say how long the retreat will last.
Why it matters
The dollar retreated after hitting an 18-month high as markets reassessed rate-hike odds following stronger inflation data and cautious comments from Federal Reserve officials. Treasury yields also moved lower, helping weaken the currency against the euro and sterling. The immediate focus is on upcoming US producer price and retail sales figures, but the reporting does not state whether the move will persist or how Fed policy will change.