financetom
News
financetom
/
News
/
Dollar holds firm ahead of US inflation data
News World Market Environment Technology Personal Finance Politics Retail Business Economy Cryptocurrency Forex Stocks Market Commodities
Dollar holds firm ahead of US inflation data
Aug 11, 2026 6:49 AM

The US dollar held largely steady against most major currencies on Tuesday as investors monitored geopolitical developments in the Middle East while awaiting key US inflation data.

The US Dollar Index was little changed at 99.84, while oil prices hovered near their highest levels in a week as hopes faded for an agreement between the United States and Iran to end the conflict in the Middle East.

The index, which measures the US currency against six major peers, traded broadly unchanged around 99.8 after hitting its lowest level since June 15 on Friday.

US inflation data in focus

The main event for currency markets this week is a series of US inflation-related data releases, prompting traders to remain cautious and keeping the dollar largely confined to a narrow trading range.

Wednesday's Consumer Price Index report could reveal the impact of the war with Iran on inflation. Producer Price Index data due Thursday and retail sales figures scheduled for Friday are expected to provide further clues about the inflation outlook.

Data released on Friday showed that the US economy unexpectedly lost jobs in July, while employment gains for the previous two months were sharply revised lower, reducing expectations that the Federal Reserve will raise interest rates next month.

The weak labor-market figures have increased the importance of Wednesday's CPI report as investors look for clues about the Federal Reserve's next policy move.

Analysts view the labor-market data as negative for the dollar, suggesting the currency could retain a bearish bias this week. However, a surprisingly strong CPI reading could prompt markets to once again price an interest-rate hike as the base-case scenario.

Market expectations for a September rate hike have fallen to around 44%, from 67% a week ago. US Treasury yields have also largely maintained their post-jobs-report declines as the weak data reduced bets on a rate increase, with the 10-year Treasury yield trading around 4.647%.

Core CPI is expected to rise 0.2% month-on-month in July, while the annual rate is forecast to slow to 2.5% from 2.6% in June.

Thursday's producer-price data and Friday's retail-sales figures will provide further indications about the inflation outlook.

Iran and Strait of Hormuz developments in focus

Investors continue to closely monitor negotiations aimed at reopening the Strait of Hormuz and their potential impact on energy prices.

Iran said an agreement with Oman to establish new shipping corridors is under discussion, but indicated that the United States still needs to meet additional conditions, adding to uncertainty surrounding energy supplies.

Comments
Welcome to financetom comments! Please keep conversations courteous and on-topic. To fosterproductive and respectful conversations, you may see comments from our Community Managers.
Sign up to post
Sort by
Show More Comments
Related Articles >
Euro at two-week highs as US inflation slows down
Euro at two-week highs as US inflation slows down
Jul 15, 2026
The euro strengthened against a basket of global currencies during European trading on Wednesday, extending gains against the US dollar for a second consecutive session and moving closer to a two-week high, supported by a weaker US dollar following softer-than-expected US inflation data. As global oil prices continue to climb, inflationary pressures on European Central Bank policymakers are resurfacing, reinforcing...
US dollar slips ahead of inflation data as markets await Fed chair's testimony
US dollar slips ahead of inflation data as markets await Fed chair's testimony
Jul 14, 2026
The US dollar edged lower on Tuesday but remained close to its highest level in 13 months as investors awaited the release of US inflation data and Federal Reserve Chair Kevin Warsh's testimony before Congress. Ongoing tensions in the Middle East and higher oil prices have reinforced expectations that monetary policy will remain restrictive. The United States and Iran exchanged...
Warsh: The Federal Reserve remains committed to price stability and will stay out of politics
Warsh: The Federal Reserve remains committed to price stability and will stay out of politics
Jul 14, 2026
Federal Reserve Chair Kevin Warsh told members of Congress on Tuesday that the US central bank remains fully committed to restoring price stability, stressing that the Federal Reserve will continue to operate within its statutory mandate and will not become involved in political matters. He also pledged greater transparency regarding the work of the Fed's internal task forces. Warsh said...
US inflation slows to 3.5% in June, beating forecasts as energy prices decline
US inflation slows to 3.5% in June, beating forecasts as energy prices decline
Jul 14, 2026
US consumer prices posted their largest monthly decline in more than six years in June, as a sharp drop in energy costs provided temporary relief from the inflationary pressures seen earlier this year, according to data released Tuesday by the US Bureau of Labor Statistics. The Consumer Price Index (CPI), a broad measure of goods and services prices across the...
Copyright 2023-2026 - www.financetom.com All Rights Reserved