The dollar meandered near a two-week low on Thursday ahead of U.S. inflation data that will help shape the Federal Reserve's next policy steps, a day after the release of minutes from the Fed's last meeting showed policymakers taking a cautious stance.
The dollar index, which measures the U.S. currency against six rivals, was at 105.69, broadly flat on the day, but not far from 105.53, its lowest since Sept. 25 touched earlier in the day.
The euro and yen were both steady against the dollar, at $1.0621 for the European common currency and 149.13 per dollar for the yen, with major moves capped by the looming inflation figures.
September's U.S. consumer price index data, which is expected to show inflation moderated last month, is due at 1230 GMT.
The dollar's recent weakness has been driven by declining Treasury yields as bond prices rallied on the Fed's softer stance on future rate rises. Bond yields move opposite to their price. The yield on 10-year Treasury notes was down a touch at 4.575%. It hit its highest since 2007 last week at 4.887 but is down more than 20 bps this week.
Also in the mix for currency investors on Thursday was sluggish British growth figures, which showed the economy partially recovered in August after a sharp drop in July.
The pound initially did not significantly react but was last down 0.16% at $1.2294.
The pound was the best performing G10 currency in the first half of this year, thanks to better-than-expected economic data and sticky inflation that drove expectations the Bank of England (BoE) would be increasing rates for longer than most peers.
It then had its worst month in a year in September, as those factors reversed, before steadying this month.
Thursday's CPI release comes after Wednesday's mixed report on U.S. producer prices, and minutes from the Fed's September meeting.
Fed officials pointed to uncertainties around the economy, oil prices and financial markets as supporting "the case for proceeding carefully in determining the extent of additional policy firming that may be appropriate", the minutes showed.
The Swiss franc was set to strengthen for the seventh successive session, the longest streak since July 2020.
The dollar was last down 0.25% at 0.8997.
Source : Reuters
