Dollar still soft against its peers; New Zealand dollar tumbles due to weak inflation data

Dollar dropped

The dollar was overpowered against its major opposing currencies on Tuesday’s open after the concerns of investors regarding the pace of Fed’s policy tightening. On the same day, the New Zealand dollar struggled to acquire gains because of its released inflation figures.

The released inflation data in the United States came out softer than expected and retail sales have strengthened expectations that the U.S. Federal Reserve would likely not push through lifting rates by December 2017, regardless of the speculation of policy makers on the movement. Money market instruments believe there is still a 50 percent chance that the Fed will incite an interest rate hike this year.

Policy makers from several central banks in Canada, UK and the euro zone have indicated they can adjust their policies if needed, with the Bank of Canada lifting rates for the first time since 2010.

The index which tracks the value of the greenback relative to its major peers, the U.S. dollar index, still notched its 10-month low at 95.018; the index was previously at 95.156 in the midst of Asian trading. It shed as much as 8.4 percent since January 3. On the dollar’s performance against one of its peers, the Japanese yen, it seemed to run out of steam following gits 14-month high of 114.495 on the previous week.

On other currencies, the New Zealand dollar fell more than 0.6 percent to $0.7278 following the posted consumer price inflation data in the country came out flat for Q2, lower compared to what they released on the first quarter with 1.0 percent. 

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