Dollar dips after soft US inflation data, Aussie, New Zealand dollars outperform

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Key Points

NEW YORK (Reuters) The dollar index gave up earlier gains and higher beta currencies, including the New Zealand and Australian dollars, outperformed on Friday after U.S. producer prices unexpectedly fell in December, raising expectations of an early U.S. rate cut...

The producer price index for final demand dipped 0.1% last month, after a decline in the cost of goods, while prices for services were unchanged, increasing the chances of lower inflation in the months ahead...

Fed funds futures imply an 81% chance of a March rate cut, up from 73% on Thursday, according to the CME Groups FedWatch Tool...

Even though you wouldnt say overall that the macroeconomic picture is screaming at you that they need to cut that fast, the market seems to be excited about the prospect of cuts, said Steve Englander, Head, Global G10 FX Research and North America Macro Strategy, Standard Chartered Bank NY Branch...

Sterling edged higher, recovering earlier losses after data on Friday showed that Britains economy grew slightly more than expected in November but remains at risk of a mild recession...

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