The dollar retreated from its high after the release of US consumer price data, while Asian currencies showed mixed dynamics.
On Thursday, Asian currencies moved in different directions, and the US dollar retreated from its 18-month peak. The reason was fresh inflation data in the United States, which forced market participants to revise expectations for the Federal Reserve's rate.
US consumer prices in September rose 3.7 percent year-on-year against 3.4 percent in August. Economists had forecast a rise of 3.6 percent. The core reading climbed 2.6 percent, exceeding expectations of 2.5 percent. These figures again raised the question of possible tightening of the Fed's policy.
However, statements by Fed Vice Chair Michelle Bowman and San Francisco Fed President Mary Daly indicated the regulator's readiness to wait for a clearer picture on inflation. After an initial increase in expectations for a rate hike at the October 27–28 meeting, markets lowered these forecasts.
The dollar index fell 0.6 percent to 101.96. The Japanese yen lost 0.4 percent after warnings from Japanese Finance Minister Satsuki Katayama about the inadmissibility of sharp exchange rate fluctuations. The South Korean won showed the greatest weakening, the pair with the dollar rose 0.8 percent.
Pairs with the Chinese yuan remained almost unchanged. The Australian dollar declined 0.3 percent after the release of weak employment data in Australia: the number of employed fell by 39,300 people against a forecast of growth of 20,000. The unemployment rate remained at 4.7 percent. These figures reduced the likelihood of a rate hike by the Reserve Bank of Australia.
The pair with the Indian rupee added 0.1 percent, and the Singapore dollar strengthened 0.2 percent against the US dollar.