Dollar Holds Steady as Markets Await US Inflation Data Clues

The dollar traded steadily in early Asian dealings on Wednesday, despite renewed tensions in the Middle East. The US inflation data release later in the day is a key focus for markets, as it will provide clues about the direction of Federal Reserve interest rates.

Last week's softer-than-expected jobs report and a press conference by Fed Chair Kevin Warsh did little to dispel doubts about the path ahead for interest rates. ING analysts believe there is a possibility of easing inflation, assuming oil prices remain contained and the Strait of Hormuz reopens.

The US dollar index was up 0.1% at 99.858, while the yen was flat against the dollar at 159.335 yen, hovering around its weakest levels of the month. The euro held steady at $1.1537, and the British pound was unchanged at $1.3503.