US Dollar Rebounds After Hotter CPI Data

The US Dollar Index (DXY) traded with a firmer tone above the 100.00 mark on Wednesday after May inflation data pointed to persistent price pressures in the US economy.

The headline Consumer Price Index (CPI) rose 4.2% year-on-year, accelerating from 3.8% in the prior reading. On a monthly basis, CPI increased 0.5%, signaling that inflation remains sticky and above the Federal Reserve's target.

The stronger-than-expected data drove a rebound in the greenback, with the DXY recovering from recent lows as markets reassess the pace of potential rate cuts by the Fed.