The US dollar edged lower as markets scaled back expectations for Federal Reserve interest rate hikes. Data released on Thursday showed the Personal Consumption Expenditures (PCE) price index rose 0.4% month-on-month, coming in below the 0.5% increase economists had forecast. Analysts at Deutsche Bank noted in a report that this "takes some of the heat out of the Fed hike narrative that had been building over recent weeks." They added that, despite Fed officials maintaining a cautious stance on the inflation outlook, there is growing speculation that the central bank may not need to raise rates at all this year.