U.S. Dollar Slumps Following Consumer Price Inflation Data

(RTTNews) - The value of the U.S. dollar has come under pressure during trading on Wednesday, extending the pullback seen during yesterday's trading.

The U.S. dollar index has slumped by 0.63 points or 0.6 percent to 101.57, falling to its lowest levels in over two months.

Currently, the greenback is trading at 133.20 yen compared to the 133.68 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0988 compared to yesterday's $1.0912.

The weakness in the value of the U.S. dollar comes following the release of a Labor Department report showing U.S. consumer prices increased by less than expected in the month of March.

The Labor Department said its consumer price index inched up by 0.1 percent in March after climbing by 0.4 percent in February. Economists had expected consumer prices to rise by 0.3 percent.

The report also showed the annual rate of consumer price growth slowed to 5.0 percent in March from 6.0 percent in February.

The year-over-year growth was slower than the 5.2 percent expected by economists and marks the smallest 12-month increase since May 2021.

The report also said core consumer prices, which exclude food and energy prices, rose by 0.4 percent in March after advancing by 0.5 percent in February. The increase matched economist estimates.

The annual rate of growth by core consumer prices accelerated to 5.6 percent in March from 5.5 percent in February, which was also in line with expectations.

The data led to speculation the Federal Reserve is close to ending its interest rate hikes, although many economists still expect the Fed to raise rates by another quarter point early next month.