The U.S. dollar fell against its major counterparts in the New York session on Thursday, as softer-than-expected inflation data for June boosted hopes of a rate cut by the Federal Reserve in September.
Data from the Labor Department showed that the consumer price index slipped by 0.1 percent in June after coming in unchanged in May. Economists had expected consumer prices to inch up by 0.1 percent.
Excluding food and energy prices, core consumer prices crept up by 0.1 percent in June after rising by 0.2 percent in May. Core prices were expected to increase by another 0.2 percent.
The report also said the annual rate of consumer price growth slowed to 3.0 percent in June from 3.3 percent in May. Economists had expected the pace of price growth to decelerate to 3.1 percent.
The annual rate of core consumer price growth also slowed to 3.3 percent in June from 3.4 percent in May. The pace of growth was expected to remain unchanged.
Soft inflation data raised hopes that the Federal Reserve will lower interest rates as soon as September.
The greenback dropped to more than a 3-week low of 157.41 against the yen and more than a 2-week low of 0.8914 against the franc, from yesterday\'s close of 161.66 and 0.8995, respectively. The currency may locate support around 147.00 against the yen and 0.88 against the franc.
The greenback declined to near a 5-week low of 1.0899 against the euro and near a 1-year low of 1.2949 against the pound, from yesterday\'s closing values of 1.0829 and 1.2848, respectively. The greenback is seen finding support around 1.10 against the euro and 1.31 against the pound.
The greenback weakened to a 3-day low of 0.6134 against the kiwi, fresh 3-month low of 1.3584 against the loonie and more than a 6-month low of 0.6798 against the aussie, from Wednesday\'s closing quotes of 0.6081, 1.3619 and 0.6747, respectively. The greenback is likely to challenge support around 0.63 against the kiwi, 1.33 against the loonie and 0.69 against the aussie.