The Weekly Bottom Line: Rate Jitters Ahead of Inflation Release

U.S. Highlights The week’s data reminded markets that inflation is far away from the Fed’s target. Both headline and core CPI came in on par with expectations, but details suggest that disinflationary forces are softening. Retail sales rebounded from the year-end weakness. The biggest gains were picked up by auto dealers, but other categories were […]

Forex and Cryptocurrency Forecast

EUR/USD: The Fed Doesn’t Hinder the US Economy January data released on Tuesday, February 14 showed that the US Federal Reserve’s victory over inflation is still very, very far away. The core Consumer Price Index (CPI) remained unchanged on a monthly basis at +0.4%. At the same time, although the annual data were slightly lower […]

US-China Relations Remain Tense

Market movers today Today, focus will be on Sweden where we get January inflation data and Riksbank minutes. We expect both headline and core CPIF to print higher than Riksbank’s forecasts: CPIF at 10.2% y/y and CPIF excl. Energy at 8.4 % y/y. US markets are closed today for the Presidents Day. Tomorrow, focus turns […]

The Planet is Boiling

Tensions between US and China ramped up as Wang Yi said that Americans’ response to the spy balloon was ‘hysterical’. Antony Blinken said that the object’s entry in the US airspace was ‘irresponsible’. He also said that they have information that China is considering a dangerous aid to Russia which could cause ‘a serios problem’. […]

As US Yields Hit Resistance, Dollar Lost Momentum

Markets Technical levels prevailed on Friday during US trading hours. A strong repositioning drive pulled core bonds lower since the release of January US payrolls. Markets are finally embracing the idea that policy rates will peak at higher levels and remain there for longer. ECB Villeroy for the first time implicitly put forward 4% as […]

Who's the New BOJ Governor?

Overnight, there was considerable movement in the USDJPY with rampant press speculation over who would be nominated as the next governor of the BOJ. There has been a lot of anticipation about the announcement, since the new governor is expected to provide a new direction for the bank. Remember that the current governor, Haruhiko Kuroda, […]

Week Ahead – US Inflation and BoJ Governor Nomination in Focus

An action-packed week lies ahead for FX traders. The dollar staged a recovery lately as markets priced in a higher peak for Fed rates, but whether this comeback has scope to continue will depend on the upcoming US inflation report. Over in Japan, the nation will enter a new chapter with the nomination of its […]

Traders on the Edge of Their Seats in Anticipation of the US CPIs

With market participants revising up their implied path for the Fed funds target rate after the astounding US employment report for January, the dollar is set to eke out gains for the second straight week. That said, the next test for the currency may come in the form of the January CPI data, due to […]

Week Ahead – A Valentine's Day Treat

US The Valentine’s Day inflation report is the main event of this week.  Disinflation trends will get tested here and we could potentially have a major turning point with Wall Street’s expectations on how high the Fed will have to take interest rates. The January inflation report is expected to show headline CPI from a […]

January Jobs Report Scrambles the Signals on U.S. Inflation

U.S inflation will be the focus next week after a surge in January employment raised eyebrows. The surprise jump in the measure has raised concerns that the economy isn’t cooling quickly enough to ease price pressures. Still, we expect CPI growth edged down to 6.2% in January from 6.5% in December (year-over-year). Food price growth […]