FRANKFURT (dpa-AFX) – The euro fell on Tuesday according to US inflation data. In the afternoon the common currency cost 1.0912 US dollars. In the morning the euro was still a little higher. The European Central Bank (ECB) set the reference rate at 1.0916 (Monday: 1.0926 dollars. The dollar therefore cost 0.9160 (0.9152) euros.
Advertising
Trade EUR/USD and other currencies with leverage via CFD (long and short)
Trade currency pairs like EUR/USD with leverage at Plus500 and participate in rising and falling prices.
Plus500: Please note the Hints5 about this advertisement.
The dollar was boosted by inflation data from the USA. Consumer prices rose by 3.2 percent in February compared to the same month last year. On average, economists had expected an unchanged inflation rate of 3.1 percent. This dampened expectations that the US Federal Reserve would soon cut key interest rates. The dollar rose against all major currencies.
The numbers are of great importance for the Fed’s monetary policy. It has kept its key interest rates stable in recent months. The financial markets are largely expecting interest rate cuts from June this year. Fed officials have recently dampened expectations. They first want to wait and see how inflation develops.
“The data confirms the caution of the Fed, which had refused to declare victory over inflation and preferred to wait for further data,” commented Commerzbank economists. “Exaggerated expectations regarding rapid and comprehensive interest rate cuts are unlikely to materialize.” The data increased the risk that the Fed would not take action until after June.
For other important currencies, the ECB set the reference rates for one euro at 0.85458 (0.85208) British pounds, 161.39 (160.43) Japanese yen and 0.9588 (0.9594) Swiss francs. The troy ounce of gold was trading at $2,162 in London in the afternoon. That was $20 less than the day before./jsl/jha/