U.S. dollar fell in late trading on Tuesday, as investors digested slightly increased U.S. consumer prices in February, pointing to low inflation that might fuel market bets on unchanged interest rates by the U.S. Federal Reserve.

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in February on a seasonally adjusted basis after being unchanged in January, the U.S. Bureau of Labor Statistics reported Tuesday.

The overall small increase, the first time in four months, came after the indexes for shelter and food rose, and the gasoline index rallied after recent declines.

CPI-U is one of the two indexes to measure consumer inflation for all urban consumers, the other being the Chained Consumer Price Index for All Urban Consumers, the bureau said in a statement.

As February's tepid rise was followed by three straight months of no change in the CPI-U, it is widely acknowleged that U.S. inflation has been at a low level, which the Fed has used to support its patient approach to further monetary tightening moves.

In late New York trading, the euro increased to 1.1296 dollars from 1.1240 dollars in the previous session, and the British pound fell to 1.3084 dollars from 1.3150 U.S. dollars in the previous session. The Australian dollar rose to 0.7087 dollar from 0.7061 dollar.

The U.S. dollar bought 111.27 Japanese yen, higher than 111.22 Japanese yen of the previous session. The U.S. dollar fell to 1.0069 Swiss franc from 1.0112 Swiss franc, and it was down to 1.3362 Canadian dollars from 1.3408 Canadian dollars.