Sunday, 4 June 2023

Dollar trims gains against euro after US inflation data

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US dollar trimmed its gains against the euro today, Friday, after US data showed a slowdown in personal consumption spending growth in February, which boosts hopes that the Federal Reserve (the US central bank) will ease the pace of monetary tightening.

According to Reuters, the euro fell 0.17 percent at $1.08855 after the data was released. It had fallen before the data, to $1.08645

Earlier in the session, data showed that inflation in the euro zone fell at the most rate ever in March, but pressures on core prices, which exclude food and energy, accelerated, leaving the European Central Bank under pressure to continue raising interest rates.

This data makes the markets expect more interest rates to be raised in the euro area than in the United States.

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