Dollar Rises As Hot PPI Data Dents Rate Cut Hopes

(RTTNews) - The U.S. dollar climbed higher on Thursday, gaining against most of its major counterparts, as data showing a bigger than expected increase in producer prices dented hopes of the possibility of an interest rate by the Federal Reserve in June.

Data from the Labor Department showed the producer price index for final demand climbed by 0.6% in February after rising by 0.3% in January. Economists had expected producer prices to rise by another 0.3%.

The report also said the annual rate of producer price growth accelerated to 1.6% in February from a revised 1% in January.

Economists had expected the year-over-year price growth to rise to 1.1% from the 0.9% originally reported for the previous month.

A report from the Commerce Department said retail sales climbed by 0.6% in February after slumping by a revised 1.1% in January. Economists had expected retail sales to increase by 0.8%.

Excluding sales by motor vehicle and parts dealers, retail sales rose by 0.3% in February after falling by 0.8% in January. Ex-auto sales were expected to rise by 0.5%.

A separate data from the Labor Department showed first-time claims for U.S. unemployment benefits edged slightly lower in the week ended February 9th, dropping to 209,000 from the previous week's revised level of 210,000. Economists had expected jobless claims to inch up to 218,000 from the 217,000 originally reported for the previous week.

The dollar index climbed to 103.40, gaining about 0.6%.

Against the Euro, the dollar firmed to 1.0885 from 1.0950. The dollar strengthened to 1.2753 from 1.2795. Against the Japanese currency, the dollar surged higher, fetching 148.30 yen a unit.

The dollar gained against the Aussie, firming to 0.6580 a unit of the Australian currency. Against Swiss franc, the dollar advanced to CHF 0.8838, gaining nearly 0.6%. The Loonie weakened to C$ 1.3536 against the U.S. dollar, from C$ 1.3472.