The dollar edged higher on Tuesday after consumer price data showed inflation still rising but on a downward slope, in a widely anticipated reading that may lead the Federal Reserve to slow or even pause hiking interest rates next week.
The dollar index rose 0.106%, with the euro down 0.12% to $1.0716.
The Consumer Price Index (CPI) increased 0.4% last month after accelerating 0.5% in January, the Labor Department said on Tuesday. That lowered the year-on-year increase in the CPI to 6.0% in February, the smallest annual rise since September 2021. The CPI rose 6.4% in the 12 months through January.
Investors are mixed on whether rising inflation will push the Fed to hike rates again at its policy meeting next week after the collapse of Silicon Valley Bank and Signature Bank sparked turmoil in financial markets.
