Dollar falls after U.S. inflation data

The dollar fell on Tuesday after data showed the annual rise in consumer prices was the smallest since late 2021, affirming expectations the Federal Reserve may be nearing the end of its tightening cycle.

The consumer price index increased 0.5% last month after gaining 0.1% in December, data showed. Monthly inflation was boosted in part by rising gasoline prices, which increased 3.6% in January.

But in the 12 months through January, the CPI grew 6.4%, the smallest gain since October 2021, and followed a 6.5% rise in December. The annual CPI peaked at 9.1% in June, which was the biggest increase since November 1981.

The dollar index fell 0.2% to 102.93. Against the yen, the dollar slid 0.2% to 132.195.