Investing.com – The dollar fell against a basket of major currencies on Thursday as a surge in sterling to one-year highs offset a duo of economic reports indicating the U.S. economy is poised for strong third-quarter economic growth.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.05% to 92.34.
The dollar failed to capitalize on better-than-expected inflation and initial claims jobless data in the wake of a surge in sterling amid rising expectations that the Bank of England will raise rates sooner rather than later.
The Labor Department said on Thursday its Consumer Price index rose 0.4% last month after edging up 0.1% in July. The uptick in consumer prices in August was the largest monthly gain in seven months and lifted the year-on-year increase in the CPI to 1.9% from 1.7% in July.
In a separate report the U.S. Department of Labor reported that initial jobless claims decreased by 14,000 to 284,000 in the week ended Sept. 10, confounding forecasts of a 2,000 increase.
A strong day for sterling, however, weighed on dollar sentiment, after the Bank of England kept rates unchanged but warned that interest rates were likely to rise for the first time in more than a decade in the “coming months” to curb the fast pace of inflation.
GBP/USD jumped to a one-year high of $1.3403.
EUR/USD fell 0.03% to $1.1.881 while EUR/GBP slumped 1.14% to £0.8870.
USD/JPY rose 0.22% to Y110.72 while USD/CAD added 0.22% to C$1.2200.