Dollar Holds Near 8-Day High as US Inflation Data Lifts Fed Hike Odds

The US dollar held near an eight-day high on Thursday after US inflation data was released. The Personal Consumption Expenditures Price Index rose 3.7% in the 12 months through July, unchanged from June and slightly above the 3.6% estimate.

This kept alive market expectations of a Federal Reserve rate hike by year-end. Fed Chairman Kevin Warsh's upcoming Jackson Hole speech 'will be the ultimate test,' according to Westpac economist Ryan Wells.

The dollar index rose 0.21% to 99.13, its highest level since August 19. Markets are also watching a speech and press conference from Bank of Japan Deputy Governor Ryozo Himino for signals on the likelihood of a September rate hike.