The US Dollar Index eased to 109.50, retreating from a two-year high of 110.16, as market participants shifted focus toward upcoming inflation data. This marks a slight pause in the dollar's recent bullish momentum.

Since October, the dollar has gained 10%, surpassing the 50-day, 100-day, and 200-day moving averages, indicating strong upward trends. However, the upcoming inflation reports may pose a critical test to its strength.

Today's Producer Price Index (PPI) will provide insights into whether manufacturers are passing on higher costs to consumers. Additionally, tomorrow's Consumer Price Index (CPI) is projected to reveal an increase in December's inflation to 2.9% from November's 2.7%, potentially raising concerns about persistent price pressures.