NEW YORK (Reuters) -The U.S. dollar jumped on Wednesday after data showed that consumer prices rose more than economists expected in January, raising the likelihood that the Federal Reserve will hold interest rates higher for longer as it battles to bring down price pressures.
The headline consumer price index rose by 0.5% in January, while the core index rose by 0.4%. Both were expected to rise by 0.3%.
That puts headline consumer price gains at 3.0% for the year, above expectations for a 2.9% increase, while core prices rose at an annual pace of 3.3%, above expectations for a 3.1% rise.
The dollar index was last up 0.52% on the day at 108.49, while the euro fell 0.42% to $1.0317. Against the Japanese yen, the dollar strengthened 1.19% to 154.3 yen.
Interest rate futures traders are now pricing in only 26 basis points of cuts by December, down from around 37 basis points before the data, implying only one 25 basis point cut for the year.
(Reporting by Karen Brettell; Editing by Alex Richardson)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibility for its content.