©Reuters. The euro down due to US inflation and below parity
Frankfurt (Germany), Sep 14 (.).- The euro fell this Wednesday due to increased expectations that the Federal Reserve (Fed) will raise interest rates by one percentage point this month to curb inflation.
The euro was trading at $0.9984 by 3pm GMT, down from $1.0019 in late European forex trading the previous day.
The European Central Bank (ECB) set the exchange rate for the euro at $0.9990.
Producer prices fell in August in the US to 8.7% yoy, from 9.8% yoy in the previous month.
Consumer prices fell in August, for the second consecutive month, to 8.3%, two tenths less than in July, but a higher figure than expected.
The market now considers it more likely that the Fed will raise the price of money by one percentage point this month and by 75 basis points in November.
In this way, interest rates will be higher in the US than in the euro zone and this boosts the dollar because investments denominated in this currency give more returns.
Likewise, it increases the yield of the US Treasury debt to two years to maximums since 2007.
The single currency was traded in a fluctuation band between $0.9961 and $1.0023.