Euro Surges Past $1.15 as Cooling US Inflation Weighs on Dollar

The euro has strengthened against the US dollar, trading above $1.15 for the first time since May 2022.

This development comes as the latest US consumer price index (CPI) report showed a year-on-year inflation rate of 6.5% for December, down from 7.1% in November.

The cooling US inflation data has reduced expectations of aggressive Federal Reserve interest rate hikes, weighing on the dollar and supporting the euro.

The European Central Bank (ECB) has also signaled a more hawkish stance, with ECB President Christine Lagarde and policymakers indicating that interest rates will continue to rise at a steady pace in the coming months.