U.S. Dollar Ticks Higher Amid Inflation Data Release, Expectations Of Reopening Of Strait Of Hormuz

(RTTNews) - The U.S. Dollar value inched higher as investors weighed today's inflation data that pushed the odds for a rate hike in the U.S. higher against reports of an upcoming meeting between the Gulf Cooperation Council nations and Iran to hasten the reopening of the Strait of Hormuz.

Today, the U.S. Dollar Index DXY, which measures the Greenback against a basket of other major currencies, was last seen trading at 99.13, down by 0.05 (or 0.05%).

While against the Euro, the USD was trading at 1.159, up by 0.12%, against the GBP, the USD was trading at 1.352, down by 0.12%.

Against the USD, the Japanese Yen was trading at 153.509, up by 0.59%, the Swiss Franc was trading at 0.816, down by 0.46%; and the Canadian Dollar was trading at 1.387, down by 0.29%.

Against one unit of Australian Dollar, the USD was trading at 0.716, down by 0.18%.

Today, the data from the U.S. Bureau of Labor Statistics revealed that, on a month-on-month basis, the Consumer Price Index increased 0.40% in August. On a year-on-year basis, the CPI steadied at 3.40% in August, unchanged from July. Both these prints came in line with market expectations.

Further, on a month-on-month basis, the core Consumer Price Index in the U.S. (which excludes food and energy) increased by 0.30% in August. On a year-on-year basis, the core CPI eased to 2.40% in August.

The University of Michigan's preliminary consumer sentiment index fell to 47.80 in September, weaker than market expectations.

Yesterday's data revealed that on a month-on-month basis, the Producer Price Index increased 0.40% in August and on a year-on-year basis, it increased 5.40%.

U.S. Labor Department data revealed that on a month-on-month basis, the core Producer Price Index (which excludes food and energy sectors), increased 0.20% from the previous month in August. For the same month, on a year-on-year basis, the core PPI inched up to 4.60%.

Currently, investors are betting on a 86.50% chance of a 25-basis-point interest rate-hike at the upcoming meeting of the U.S. Federal Reserve on September 15-16 while the odds on rates being held at the current level stand at 13.50%, according to the CME Group's FedWatch Tool.

A report by Financial Times today indicated that the foreign ministers of the Gulf Cooperation Council (GCC) are set to meet their Iranian counterpart in the coming week.

The meeting is intended to secure a deal with Iran to reopen the Strait of Hormuz for commercial shipping as well as to de-escalate the Middle East crisis.

Following the news, crude oil prices tumbled by more than 2.00%.

The member countries of the GCC in the Arabian Peninsula, namely Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Oman, and Bahrain suffered from the retaliatory attacks by Iran during the ongoing U.S.-Iran conflict.

All these nations produce crude oil but have paused or minimized production due to the disability in exporting the output after Iran shut the Strait of Hormuz.

According to the FT report, this initiative is undertaken by Oman with the meeting slated to be held in the coastal city of Salalah on Monday.

The Strait of Hormuz remains shut since the end of February when the U.S.-Iran conflict began which is showing no sign of de-escalation.

U.S. and Iran have stepped up their attacks on each other's targets in the recent weeks.