News: FOREX-Dollar edges down ahead of key U.S. inflation data

The dollar edged lower on Wednesday, ahead of U.S. inflation data which markets will scrutinise for guidance on how steeply the U.S. Federal Reserve will raise interest rates.
The figures were due at 1230 GMT. Economists expect year-on-year headline inflation USCPNY=ECI to be running at a scorching 8.7%, a small retreat from June's 9.1%. Core inflation is expected at 0.5% month-on-month USCPF=ECI .
There were a few small ripples in the pre-CPI calm in morning trade in Europe. The euro EUR=EBS climbed 0.28% to $1.02425, sterling GBP=D3 gained 0.17% to $1.2095, and the dollar also lost 0.5% on the Swiss franc CHF=EBS , which traded at 0.94885 per greenback.
But the day's main event had yet to come. A strong U.S. inflation print would damage the case that the Fed will pivot away from its focus on curtailing inflation with interest rate hikes and instead worry more about a recession, and so potentially raise rates more slowly.
Speculation that the Fed will make such a pivot weighed on the dollar earlier this month, though it has since walked back some of those losses.
"All eyes are on U.S. CPI," said Carol Kong, a currency strategist at Commonwealth Bank of Australia. The impact of the data in currency markets, she said, would likely be seen most in dollar/yen, particularly sensitive to moves in U.S. treasuries.
The greenback was unchanged versus the Japanese yen on Wednesday ahead of the CPI print with one dollar worth 135 yen.
Traders expect reaction to turn on the core inflation figure.
"The market will initially get more excited by a downside core CPI surprise than an upside surprise," said Deutsche Bank strategist Alan Ruskin. A downward surprise would feed into hopes that falling commodity prices mean inflation can quickly recede.
"It will also play to the market's recent proclivity to buy risk dips, and will be a broad-based negative for the U.S. dollar," he said.
A quick reading on policymakers' reaction may come from Fed officials Charles Evans and Neel Kashkari, who were due to make speeches at 1500 GMT and 1800 GMT, though they will have another set of price data in August before September's policy meeting.
The Australian dollar AUD=D3 was calm, last hovering at $0.6971, just above its 50-day moving average.
Bitcoin BTC=BTSP , rattled by a drumbeat of cryptocurrency fund wipeouts and thefts over recent months, was at $23,000 on Wednesday.
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	Currency bid prices at 1106 GMT 
 Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
											  Previous				   Change				  
											  Session											
 Euro/Dollar	   EUR=EBS	$1.0239		$1.0213	 +0.25%		 -9.94%	  +1.0245	 +1.0202 
 Dollar/Yen		JPY=EBS	134.9850	   135.1250	-0.14%		 +17.31%	 +135.2950   +134.9100 
 Euro/Yen		 																			 
 Dollar/Swiss	  CHF=EBS	0.9489		 0.9537	  -0.47%		 +4.06%	  +0.9544	 +0.9489 
 Sterling/Dollar   GBP=D3	 1.2097		 1.2075	  +0.17%		 -10.57%	 +1.2105	 +1.2066 
 Dollar/Canadian   CAD=D3	 1.2873		 1.2883	  -0.07%		 +1.82%	  +1.2895	 +1.2865 
 Aussie/Dollar	 AUD=D3	 0.6970		 0.6962	  +0.11%		 -4.11%	  +0.6979	 +0.6947 
 NZ				NZD=D3	 0.6312		 0.6288	  +0.40%		 -7.77%	  +0.6317	 +0.6277 
 Dollar/Dollar																				   
All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX
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World FX rates	https://tmsnrt.rs/2RBWI5E 
US CPI https://tmsnrt.rs/3QwZU0C
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