The frenzy of the US dollar also stormed the gold market which pushed the yellow metal to fall severely even though inflation data showed price pressure was still strong in the United States.
During the Asian trading session, gold traded down around $1,700 an ounce, after touching a low of $1,697 an ounce immediately after the data was released.
The US consumer price index (CPI) unexpectedly rose 8.3% year-on-year in August, missing expectations for a decline to 8.1% after registering 8.5% the previous month.
On a monthly basis, US headline inflation surprised the market by rising 0.1% after being unchanged in July, and the CPI also rose higher than expected at 0.6% from 0.3%
Although annual inflation declined, the stronger-than-expected reading proved that price pressures in the world's giant economy are still high.
This further strengthens investors' hopes to see a 75 basis point increase by the Federal Reserve (Fed) at the FOMC policy meeting that will take place next week.
