Before the US inflation data was released this week, investors were first shown inflation data from the world's second largest economy, China.
Disappointingly, China's consumer price index (CPI) read zero or was unchanged in June, marking the weakest rate since prices fell in February 2021.
Core inflation, which excludes food and energy costs, slowed to 0.4% last month from 0.6% recorded in May.
More disappointing for investors is the producer price (PPI) or factory-gate price fell further to the lowest level in seven years with a fall of 5.4% from the previous year.
Both indicators add to evidence that the recovery in China is weakening, where fears of deflation are weighing on confidence.
It will also prompt more speculation about possible stimulus by the authorities to advance the economic recovery.
Following the weak data, commodity currencies traded lower in the Asian session today.
The Aussie and New Zealand dollars were trading down about 0.4% against the greenback respectively to trade around 0.6665 and 0.6185 at the time of writing.
