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U.S. Dollar Falls On CPI Data

3/16/2012 9:00 AM ET

The U.S. dollar declined against other major currencies on Friday after a report showed that U.S. consumer prices rose less than expected in February.

With energy prices showing a substantial increase, the Labor Department released a report today showing a moderate increase in U.S. consumer prices in the month of February.

The Labor Department said its consumer price index rose by 0.4 percent in February following a 0.2 percent increase in January. Economists had expected the index to increase by about 0.5 percent

The greenback fell to 3-day lows of 1.3136 against the euro and 0.9186 against the franc with 1.32 and 0.91 seen as the next downside target levels, respectively.

Eurozone's merchandise trade balance slipped to a deficit in January, and exceeded economists' forecast, data released by statistical office Eurostat showed Friday.

The trade balance was a deficit of EUR7.6 billion in January, compared to a surplus of EUR9.1 billion in December, which was revised down from EUR9.7 billion. Economists were looking for a deficit of EUR3 billion in January.

The greenback fell to 83.54 against the yen, down from 83.95 hit 8:20 am ET. At yesterday's close, the pair was worth 83.58.

Against the pound, the greenback touched a 1-week low of 1.5795, compared to Thursday's close of 1.5713. The next downside target level for the greenback is seen at 1.585.

The greenback that closed Thursday's deals at 1.0527 against the aussie fell to a 1-week low of 1.0585 at the same time.

The U.S. industrial production for February is due at 9:15 am ET.

by RTT Staff Writer

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