The personal consumption expenditures (PCE) price index, tracked by the Fed for its monetary policy, advanced 0.6% last month, after gaining 0.2% in December. In the 12 months to January, the measure accelerated 5.4% after rising 5.3% in December.
Consumer spending, which accounts for more than two-thirds of US economic activity, rose 1.8% last month., according to the Department of Commerce. December data was revised up to show a decline of 0.1%, instead of the previously announced 0.2%.
“The data was pretty strong overall and surprisingly there were positive reviews as well. That’s saying a lot. The dollar is in the driver’s seat,” said Mazen Issa, of TD Securities in New York.
The dollar index improved 0.7%, to 105.26 units, after reaching a seven-week high of 105.32.
The euro was down 0.5% at $1.054, after falling earlier to a seven-week low of $1.0536. Sterling was down 0.68% at $1.1938.
Against the yen, the US currency reached two-month highs at 136.44 units, and was later exchanged at 136.29, up 1.2%. Against the Swiss franc, the greenback reached its highest level in seven weeks, at 0.9390 units, and then improved 0.5%, to 0.9386 units.
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