US Dollars Ease from 1-year High ahead of the CPI Data

On Wednesday, the US dollars eased back from a 1-year high ahead of the consumer price index (CPI) today. 

The US dollar index, which trails the greenback against a basket of its rival currencies, weakened 0.15% to $94.37 per share. At the same time, it reversed its hike of 0.16% or $94.53 yesterday.

Accordingly, the forecasted core CPI extended to 0.20% month-on-month from the August figure of 0.10%. It also remained at 4.00% year-over-year.

It is a key measure of the changes in purchasing trends and inflation, a significant miss in the data would weigh down the safe-haven currency. 

Moreover, the JOLTs job openings, a measure of work vacancies, plummeted to 10.44 million from the previous number of 11.10 million. 

It also came in lower than the analysts’ estimate of $10.93 million, generally bearish for the US dollars. 

In addition, investors looked for hints for the possible Federal Reserve’s asset tapering in November. Subsequently, the trading market anticipated an interest rate hike next year. 

Correspondingly, some Fed officials mentioned that the American economy healed enough from the implications brought by the pandemic. 

Subsequently, Vice Chair Richard Clarida suggested that the central bank could now scale back on its asset-purchase program.

Meanwhile, soaring energy costs fueled concerns about inflation. Analysts projected that the Fed could move faster than expected. 

Then, currencies against US dollars were mixed in the trading market. 

For instance, the yen exchange rate curtailed 0.13% to $113.44, down from a three-year high in the last session. 

Likewise, the Canadian dollar plunged 0.05% to $1.25 as the Australian dollar lost 0.16% to $0.73. 

GBP to USD Exchange Rate Bounces Higher

Conversely, the Pound sterling edged up 0.15% to $1.36, reversing its Tuesday plunge of 0.07%.

On the economic data front, the United Kingdom’s gross domestic product reduced to 6.90% from the last data of 7.50%.

On a positive note, the report is higher than the estimated rate of 6.70%, pushing the GBP. 

Additionally, the manufacturing production boosted to 0.50% from -0.60%, which is bullish for the currency. 

Meanwhile, the trade balance is quite bearish to sterling as it decreased to -14.93 billion from the previous 12.71 billion.

Similarly, the euro amplified 0.16% to $1.16 against the US dollars. 

Inversely, the Swiss franc shed 0.14% to $0.93, opposite to its gain of 0.33% yesterday.