FOREX-Dollar soft as traders weigh Fed rate cut prospects

The dollar dipped on Friday, while the euro edged higher after steep overnight losses as traders weighed data that showed inflation was easing, stoking expectations that interest rates had peaked and central banks would soon start cutting rates. The eagerly awaited personal consumption expenditures (PCE) price index rose 3% in October from a year ago, moderating from a three-month string of 3.4% readings though still above the Fed's 2% target. "While the 3% level remains too high to declare victory on inflation, it marks a new low for the series that will likely please the Fed and alleviate any pressure to implement further hikes," said Ryan Brandham, head of global capital markets, North America, at Validus Risk Management.