Dollar Climbs Higher Against Major Counterparts

(RTTNews) - The U.S. dollar climbed higher on Wednesday, gaining some ground after exhibiting weakness over the past several sessions, as data showed a smaller than expected increase in U.S. consumer price inflation.

Traders also continued to closely follow the developments on the tariff front. Europe retaliated after Trump's increased tariffs on U.S. Steel and aluminum imports took effect. The EU said it will impose tariffs on 26 billion euros worth of U.S. goods from next month.

With regard to Canada, Trump reversed course on a pledge to double tariffs on steel and aluminum to 50%, minutes after the Canadian province of Ontario backed off its plans for a 25% surcharge on electricity.

Data from the Labor Department showed consumer prices in the U.S. increased by slightly less than expected in the month of February, edging up by 0.2%, after climbing by 0.5% in January. Economists had expected consumer prices to rise by 0.3%.

The report also said the annual rate of consumer price growth slowed to 2.8% in February from 3% in January. Economists had expected the pace of price growth to edge down to 2.9%.

The Bank of Canada today lowered interest rates by another 25 basis points, making its seventh straight rate cut.

The Bank of Canada said it decided to reduce its target for the overnight rate to 2.75 percent, with the Bank Rate at 3 percent and the deposit rate at 2.70 percent.

While the central bank noted Canadian economic growth has come in stronger than expected, it warned the pervasive uncertainty created by continuously changing U.S. tariff threats is restraining consumers' spending intentions and businesses' plans to hire and invest.

The dollar index climbed to 103.78 in early New York session, and despite dropping to 103.35 around noon, edged higher subsequently and was last seen at 103.58, up 0.16% from previous close.

Against the Euro, the dollar firmed to 1.0891, and against Pound Sterling, it weakened a bit to 1.2962.

The dollar gained against the Japanese currency, fetching 148.32 yen a unit. Against the Aussie, the dollar weakened, fetching A$1.5825 a unit.

The Swiss franc weakened to 0.8819 against the greenback. The loonie gained against the U.S. dollar, firming to 1.4372.