Markets are keenly awaiting the release later today of US CPI (inflation) data, which is expected to show a month-on-month increase of 0.3% and an annualized rate of only 3.1%.
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- The USA will be releasing its CPI (inflation) data today. The data is expected to show a monthly inflation of 0.3% and a strongly dropping annualized rate of 3.1%, following last month’s strong fall. An unexpected rise of a much smaller drop could boost the value of the USD, but if the data is as expected, the USD will most likely continue to decline.
- The Bank of Canada will be holding a policy meeting today and is expected to raise its interest rate by 0.25% to 5.00%.
- The Reserve Bank of New Zealand left its Official Rate unchanged, as had been widely affected. The NZD barely reacted to the Bank’s policy meeting.
- In the Forex market, the spotlight is on the USD/JPY currency pair as the Japanese Yen continues its multi-day streak of getting stronger, with the Yen the strongest major currency so far today and the US Dollar the weakest. USD/JPY is now trading well below ¥140 which calls into suggests that the former long-term bullish trend is over, as the price has now made what looks like more than just a bearish retracement. Feelings are growing that the Yen has reached a major turning point as the Bank of Japan begins to inch away from its former ultra-loose monetary policy.
- The GBP/USD currency pair is also in focus, as it continues to break to new long-term highs and exhibit bullish momentum. GBP/USD is now trading at a 15-month high close to $1.2970.
- Bitcoin remains below what seems to be a very pivotal round number at $31k, with the price action now looking more uncertain, suggesting that a bullish breakout may not be likely.
- Equity markets are mixed, but the Hang Seng Index is up by more than 1% on the day so far.
- UK unemployment claims data released yesterday came in very slightly higher than expected.
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