US dollar slips against yen as focus shifts to inflation data 

By Gregor Stuart Hunter and Johann M Cherian

July 30 (Reuters) - The dollar weakened against the yen connected Thursday up of a U.S. ostentation study that investors volition scrutinize to gauge the way for involvement rates, a ‌day aft the Federal Reserve near markets guessing astir its aboriginal monetary policy.

The yen popped 0.3% to a one-week ‌high of 162.88 to the dollar, though traders said the spike did not bespeak immoderate signs of an involution by Japanese authorities to halt the currency's ​slide to caller multi-decade lows.

The dollar had risen against astir large currencies aboriginal connected Thursday aft the U.S. said it was conducting aerial strikes successful Iran, which generated appetite for harmless havens among investors.

However, it came nether unit arsenic the absorption shifted to the Personal Consumption Expenditures Index owed astatine 1230 GMT.

Economists expect the scale to amusement terms pressures roseate by 3.7% connected an yearly ground successful June, ‌down from 4.1% the period before, arsenic vigor ⁠costs moderated during the little détente betwixt Iran and the U.S.

The euro was level astatine $1.1477, portion the dollar index, which measures the dollar's spot against six different currencies, was muted astatine 100.67, having deed ⁠a one-week debased successful the erstwhile session.

"Warsh's comments astatine the property league besides did not suggest the Fed is successful a unreserved to hike, and helium referred to a 'period of watchful thinking'," a radical of analysts led by Mark Haefele astatine UBS wrote successful a note.

"The marketplace ​interpreted ​the FOMC connection and Warsh's comments dovishly," the UBS analysts said.

Traders are ​ramping up their expectations for the Fed to ‌leave involvement rates unchanged again successful September, with the probability for a clasp present astatine 34.8%, compared with a 24% accidental earlier the latest meeting, the CME Group's FedWatch instrumentality showed.

BOE TO ALSO WAIT AND WATCH

The Bank of England kept involvement rates connected clasp arsenic expected connected Thursday, but the lb firmed 0.1% to $1.338 aft a 3rd policymaker backed a complaint hike owed to renewed U.S.-Iran conflict. Most economists polled by Reuters expected a 7-2 divided successful the Monetary Policy Committee.

Sterling besides firmed against the euro, which ‌fell astir 0.1% to 85.68 pence.

"The summation successful dissenters suggests interest astir ​inflation risks is spreading wrong the MPC and increases the accidental that rates ​could determination higher if ostentation doesn't proceed to moderate," said ​Felix Feather an economist astatine Aberdeen.

Traders are pricing successful a 34.5% accidental that the BoE volition ‌hike involvement rates successful September, LSEG-compiled information showed.