Copper prices rose on Wednesday, as the US dollar fell against most currencies, while investors parse the US inflation data.

The US consumer price index rose by 0.3% in August, lower than forecasts of 0.4%. 

The core reading (excluding food and fuel prices) rose by 0.1%, lower than forecasts of 0.3%.

The data increased uncertainty about the Federal Reserve's next move, especially about reducing the asset purchase program, as inflation seen the largest slowdown in 6 month.

Copper 3-month futures rose 0.5% to $9,486 per tonne in the London Metal Exchange.

The dollar index fell against a basket of major currencies by 0.1% to 92.5 points as of 13:37 GMT, after hitting a high of 92.6 points and a low of 92.4 points.

As of 13:36 GMT, copper December futures rose 1.1% to $4.37 a pound.

The Energy Information Administration reported today that the US crude inventories fell 6.4 million barrels to 417.4 million barrels during the past week, while analysts forecast a drop by 3.5 million barrels.

Gasoline stocks fell 1.9 million barrels to 218.1 million barrels, and the distillate stocks fell 1.7 million barrels to 131.9 million barrels.

While the American Petroleum Institute reported yesterday in preliminary data that the US crude inventories fell 5.4 million barrels during the same period.

The major US stock indices opened higher on Wednesday, after the release of the US industrial production data.

Data showed that the US industrial production index rose 0.4% during the August, slightly lower than forecasts of 0.5%.

The CPI reading yesterday showed the largest slowdown in 6 month, which increased uncertainty about the Federal Reserve's next move.

Chairman Jerome Powell of the US Federal Reserve has hinted recently at reducing the size of the bond-buying program before the end of 2021, due to rising inflation and improving economic conditions.

As for stocks, Dow Jones rose 0.2% or 58 points to 34,636 as of 14:34 GMT, and S&P 500 rose 0.2% or 7 points to 4,450, while Nasdaq rose less than 0.1% or 1 point to 15,058.

The US dollar fell against a majority of rivals on Wednesday, on track for the first loss in 4 days, due to slow demand, following after weak data, ahead of the US industrial production data.

The dollar index fell 0.3% to 92.43 points, after opening at 92.67 points, and hit a high of 92.68 points.

The US dollar index gained less than 0.1% yesterday, in the third straight daily gain, thanks to strong safe haven demand after the US stocks fell.

The greenback's drop today comes on the back of weak inflation data in the US, which raised doubts about tightening the US monetary policy.

The data eased fears of rising inflationary pressures in the US, and led to a drop in the 10-year US Treasury bond yield, which fell more than 3% on Tuesday and hit a 3-week low at 1.263%.

Now investors await key US data on the output of the industrial sectors in the US during August, which accounts for 25% of the total US GDP. 

At 13:15 GMT, the US industrial production index reading will be released, amid forecasts to rise 0.5% in August from 0.9% in July, and the capacity utilization rate is expected to reach 76.3% from 76.1%.