The euro rose to around $1.12 on Thursday, rebounding from its lowest level in a year and half, as the US dollar retreated after Federal Reserve officials signaled that policymakers could wait for a clearer picture before taking further action. The cautious remarks prompted traders to scale back bets on an October rate hike, offsetting support for the greenback from hotter-than-expected US inflation data. Meanwhile, expectations that the ECB would postpone further rate hikes until December, coupled with concerns that persistent inflation could dampen economic growth, continued to pressure the euro. Fiscal uncertainty in highly indebted countries, particularly France, further clouded the currency's outlook. ECB President Christine Lagarde said energy-driven inflation had yet to spill over into the broader euro-area economy, supporting a cautious approach to monetary policy. However, ECB policymaker Gediminas Simkus maintained that a rate hike this month remained possible if needed.