US Dollar Index falls to 99.90 after softer-than-expected producer inflation data eases expectations for further Federal Reserve tightening.
The US Dollar Index (DXY) dropped below the 100.00 mark, trading near 99.90 in early Asian trading on Friday. The decline follows weaker-than-expected US producer price index (PPI) data, which has dampened expectations for additional Federal Reserve interest rate hikes this year.
Prior to the release, the DXY had hovered above 100.00, supported by hawkish Fed commentary and stronger economic indicators. Market consensus had anticipated a modest uptick in PPI, but the softer print reinforced views that inflation pressures may be easing.
The immediate reaction saw the USD weaken across major currency pairs, with traders adjusting positions ahead of upcoming consumer inflation data.