Weaker U.S. inflation data reduces Fed rate hike bets, capping the dollar’s weekly gain despite a year-to-date rise of 2.72%.
The dollar index (DXY) traded at $100.96, up 0.19% on the day, as softer inflation readings eased expectations for further Federal Reserve tightening. The greenback remains 2.72% higher for the year but saw limited weekly gains amid shifting rate hike probabilities.
Earlier in the week, the index had dipped as investors reassessed the Fed’s policy path following cooler-than-expected inflation prints. Market pricing now reflects a lower likelihood of additional rate increases, contrasting with earlier hawkish bets.
The dollar’s modest intraday rebound reflects lingering uncertainty over global growth and central bank policies, though the broader trend remains tied to U.S. economic data.