(Corrects spelling of name in third paragraph)
* Investors focused on Fed policy
* U.S. consumer price inflation rises
* Pound gains on possible Brexit delay
By Karen Brettell
NEW YORK, Oct 18 The U.S. dollar was mixed in
choppy trading on Tuesday as investors took some profits from
the greenback's recent strength and evaluated whether the
Federal Reserve is likely to raise interest rates later this
The greenback had rallied around 3 percent since the end of
September, mirroring a climb in benchmark U.S. Treasury yields
to a four-month high above 1.8 percent on
expectations that the Fed will raise rates by December.
"The dollar's gotten stronger as more people think the Fed
will hike rates in December," said Marc Chandler, global head of
currency strategy at Brown Brothers Harriman in New York.
Weaker U.S. economic data in the past few days, including
disappointing retail sales on Friday, has led investors to book
"We've had some disappointing U.S. economic data, I think
that it's spurring a little bit of a correction. It's mostly a
technical correction after the run up," said Chandler.
The dollar index, which tracks the greenback against a
basket of six major currencies, was last up 0.06 percent
at 97.954 after weakening earlier in the day.
The dollar briefly added to weakness, before reversing
course and then rallying, after data on Tuesday showed consumer
prices rose in September.
The Labor Department said its Consumer Price Index increased
0.3 percent last month. In the 12 months through September, the
CPI rose 1.5 percent, the biggest year-on-year increase since
The dollar move largely tracked U.S. Treasury yields, which
initially fell on the data before reversing course and rising,
said Richard Scalone, co-head of foreign exchange at TJM
Brokerage in Chicago.
"It's tracking the bond market most market participants
are looking at the Fed for a potential hike in December and as
the odds of that increase or decrease there's some correlation
with how the dollar's moving," Scalone said.
The British pound was one of the best performers after a
government lawyer said parliament would "very likely" have to
ratify any deal to take Britain out of the European Union, and
following stronger-than-expected inflation numbers.
"That took a market that was overly short and put in a
little bit of uncertainty to whether Brexit would be enacted
sooner rather than later. That has squeezed some of the shorts,"
The pound was last up 0.92 percent against the dollar
(Editing by Meredith Mazzilli)