Dollar Gains Slightly as US Inflation Boosts Rate-Hike Expectations

The US dollar edged higher against major currencies on Friday, supported by US inflation data that strengthened market expectations of a potential interest-rate hike by the Federal Reserve at its meeting next week.

US Labor Department data showed that the Consumer Price Index rose 0.4% in August, following a modest 0.1% increase in July.

On an annual basis, consumer inflation reached 3.4% in August, unchanged from the rate recorded in July.

The dollar initially strengthened against the euro and Swiss franc following the release of the figures, although it later gave up part of its gains. The euro fell 0.07% to $1.1602, while the dollar rose 0.2% against the Swiss franc to 0.814 francs.