2024.01.1121:04:00UTC+00Dollar Rises On Inflation Data, But Retreats Later Against Some Major Rivals

The U.S. dollar, which climbed higher on Thursday after data showed a bigger than expected increase in the nation's consumer price inflation in the month of December, has pared gains and is turning in a mixed performance against its major counterparts.

The U.S. Labor Department said its consumer price index climbed by 0.3% in December after inching up by 0.1% in November. Economists had expected consumer prices to rise by 0.2%.

The report also showed the annual rate of consumer price growth accelerated to 3.4% in December from 3.1% in November. The annual rate of growth was expected to tick up to 3.2%.

Meanwhile, the annual rate of growth by core consumer prices slowed to 3.9% in December from 4% in November. Economists had expected the pace of core price growth to decelerate to 3.8%.

A number of economists have said the data makes the U.S. central bank less likely to cut interest rates in March, with many predicting the central bank will hold off until its May meeting.

A separate report released by the Labor Department showed first-time claims for U.S. unemployment benefits unexpectedly edged slightly lower in the week ended January 6th, falling to 202,000, a decrease of 1,000 from the previous week's revised level of 203,000. Economists had expected jobless claims to rise to 210,000 from the 202,000 originally reported for the previous week.

The dollar index climbed to 102.76 after the release of the Labor Department's inflation data, but has dropped to 102.31 now, down marginally from the previous close.

Against the Euro, the dollar is flat at 1.0974, after having firmed to 1.0931 earlier. The dollar is weak against Pound Sterling at 1.2763, easing from 1.2690 a unit of the British currency.

Against the Japanese currency, the dollar weakened to 145.32 yen. The dollar had firmed to 146.42 in early New York session after the inflation data.

The dollar is up marginally against the Aussie at 0.6688. Against Swiss franc, the dollar is up, fetching CHF 0.8520 a unit. The greenback is up slightly against the Loonie at C$1.3397.