Meanwhile, minutes from the Fed's last meeting in March showed several Federal Reserve policymakers considered pausing interest rate increases after the failure of two regional banks and but concluded high inflation needed to be tackled.
The minutes also showed staff projections of a mild recession later this year. The Fed raised interest rates by 25 basis points in March and the markets are pricing in 70% chance of another 25 bps hike in May, according to CME FedWatch Tool.
Taylor Nugent, an economist at National Australia Bank, said the CPI data and the minutes provided ample fodder for those reading the Fed tea leaves, noting that inflation showed welcome, but not overwhelming progress. San Francisco Federal Reserve Bank President Mary Daly on Wednesday said that while U.S. economic strength, labour market tightness, and too-high inflation suggest the Fed has "more work to do" on rate hikes, other factors including tighter credit conditions could argue for a pause. The euro was up 0.05% to $1.0994, having touched more than two month high of $1.1005 earlier in the session.
The Japanese yen weakened 0.04% to 133.20 per dollar, while sterling was last trading at $1.2486, up 0.04% on the day.
The Australian dollar fell 0.01% to $0.669. The kiwi slid 0.23% to $0.621. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Reporting by Ankur Banerjee in Singapore; Editing by Christopher Cushing)
Twitter: @AnkurBanerjee17;))