Dollar Loses Ground Against Major Rivals After Soft Inflation Data

(RTTNews) - The U.S. dollar drifted lower against its major counterparts on Tuesday amid bets the Federal Reserve will slowdown the pace of rate hike after data showed the nation's consumer price inflation slowed more than expected in November.

The Labor Department's report said the consumer price index crept up by 0.1% in November after climbing by 0.4% in October. Economists had expected consumer prices to rise by 0.3%.

The report also showed the annual rate of growth by consumer prices slowed to 7.1% in November from 7.7% in October.

The Federal Reserve, which is scheduled to announce its monetary policy on Wednesday, is still likely to raise interest rate by another 50 basis points, but the slower price growth may offset recent worries about future rate hikes.

The Bank of England, the European Central Bank and the Swiss National Bank are also scheduled to announce their monetary policies this week.

The dollar index dropped to a low of 103.59 soon after the release of the inflation data, and despite recovering to 104.03, remains deep down in negative territory with a loss of about 1.06%.

Against the Euro, the dollar is trading at 1.0632, down from the previous close of 1.0539.

The dollar is weak against Pound Sterling at 1.2367, easing from 1.2273.

Against the Japanese currency, the dollar is sharply lower, fetching 135.62 yen a unit, as against 137.64 yen on Monday.

The dollar has weakened to 0.6854 against the Aussie, dropping from 0.6747.

Against Swiss franc, the dollar is down more than 0.7%, fetching CHF 0.9292 a unit, compared with CHF 0.9361 on Monday.

The dollar is weak against the Loonie as well, having dropped to C$ 1.3553 from C$1.3634.