Dollar hovers near two-week lows ahead of inflation data
dollar was rooted near a two-week low on Thursday following minutes from the last U.S. Federal Reserve meeting that showed policymakers taking a cautious stance and as investors awaited key inflation data.
The dollar index, which measures the U.S.
currency against six rivals, was at 105.67, not far from 105.55, its lowest since Sept. 25 it touched on Wednesday.
The index is down 0.4% for the week.
Fed officials pointed to uncertainties around the economy, oil prices and financial markets as supporting «the case for proceeding carefully in determining the extent of additional policy firming that may be appropriate,» according to the minutes released on Wednesday from the Sept. 19-20 meeting.
In recent comments, Fed officials have cited rising bond yields as a factor that may allow them to call it a day on their rate hike cycle.
Also keeping the mood cautious was a mixed report on U.S.
producer prices, which increased more than expected in September amid higher costs for energy products and food. But underlying inflation pressures at the factory gate continued to abate.
«This (PPI data) is a reminder that the last mile of the fight against inflation is going to be a tough one,» said Ryan Brandham, head of global capital markets, North America at Validus Risk Management.
The report comes ahead of the release on Thursday of September's consumer price index data, which is expected to show inflation moderated last month.
A downside surprise to inflation will likely support the case for the Fed to have finished its tightening cycle, thereby pulling down U.S.
