WASHINGTON (dpa-AFX) - The U.S. dollar shed ground against most of its major counterparts on Tuesday as Treasury yields dropped on news that Fed Governor Lael Brainard was interviewed for the top post of the central bank last week.
Brainard is perceived as more dovish and market participants hope that the Fed would be more slow in the tightening of policy following her potential appointment.
Traders also noted Chicago Federal Reserve Bank President Charles Evans' comments on Monday that he feels the current surge in inflation is largely 'temporary' and that he believes the Fed will not need to raise interest rates until 2023.
Traders digested the data on U.S. Producer price inflation and looked ahead to the data on consumer price inflation, due on Wednesday.
A report from the Labor Department showed the producer price index for final demand advanced by 0.6% in October after climbing by 0.5% in September. Economists had expected another 0.5% increase.
Core producer prices, which exclude prices for food, energy, and trade services, rose by 0.4% in October after inching up by 0.1% in September. Core prices were expected to edge up by 0.2%.
The dollar index, which dropped to 93.88 in the European session, recovered to 94.15 subsequently, but retreated as the day progressed and is at 93.97, down 0.08 points or 0.08%.
Against the Euro, the dollar is weak at $1.1597, easing from $1.1588.
The Pound Sterling is little changed at $1.3561.
The dollar is trading at 112.86 yen, compared to 113.23 yen Monday evening.
Against the Aussie, the dollar is trading at 0.7379, gaining nearly 0.6% from 0.7423.
The Swiss franc has firmed against the dollar, trading at CHF 0.9111, up nearly 0.3% from the previous close of CHF 0.9137.
The Loonie is at 1.2439 a dollar, up slightly after having dropped to 1.2486 a dollar earlier in the day.
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