Dollar slips from 18-month high as Treasury yields fall, Fed rate hike bets ease

The dollar slipped from an 18-month high on Thursday as a sharp drop in Treasury yields weighed on the greenback, with cautious remarks from Federal Reserve officials tempering October rate hike bets despite hot inflation data. The dollar index fell 0.2% to 102.03 after hitting an 18-month peak on Wednesday, while the euro bounced 0.5% to $1.1216 and sterling rose 0.5% to $1.3253. Market pricing for an October Fed hike rose to 50% before officials signaled they could wait for clearer data. Safe-haven flows into Treasuries pushed the 10-year yield to 5.0892% and the 30-year yield to 5.4319%, both near three-week lows. Investors await retail sales and producer price data due later Thursday, plus Fed Chair Kevin Warsh's remarks on Friday.