Categories: Market Overview

Strong inflation jumpstarts the dollar

US inflation once again beat expectations, causing markets to further discount the chances of an easing cycle starting in June.

The dollar responded with a 1% rise against a basket of major currencies, taking the DXY back to 104.80. The dollar recorded two peaks near these levels in February and late March, and it has not traded steadily higher since November.

The general and core consumer price indexes each added 0.4% versus 0.3% expected. The annual rate of general inflation rose to 3.5%, while the core index maintained its 3.8% y/y pace. In both cases, the monthly rates of increase defy expectations of a return to the targeted 2%.

This should be troubling news on top of the strong employment report late last week. The data-linked Fed is unlikely to miss the data set of the past five days and is likely to maintain its wait-and-see stance.

Technically, the current upside momentum looks like an attempt to break away from support in the form of the 50 and 200-day moving average crossover and head higher after a prolonged consolidation. This movement may not meet any significant resistance until the 106.80-107 area, where the downward reversal was formed last October.

The FxPro Analyst Team

The FxPro Analyst Team

Our team consists of financial market experts. Our dedicated professionals prepare reviews on the foreign exchange market situation, Crude Oil, Gold and Stock Indices. All the analysts are regularly published in the world leading economic media.

Share
Published by
The FxPro Analyst Team
Tags: cpidxyusd

Recent Posts

The dollar has reached range limits

The US dollar has strengthened, reaching the upper boundary of its trading range. The British…

35 mins ago

Crypto: Tug-of-war at new altitude

Cryptocurrencies continued to surge, pushing the total cap to $3 trillion. Bitcoin has gained nearly…

60 mins ago

USDJPY Wave Analysis 13 November 2024

- USDJPY broke key resistance level 154.70 - Likely to rise to resistance level 157.20…

21 hours ago

USDJPY Wave Analysis 13 November 2024

- USDJPY broke key resistance level 154.70 - Likely to rise to resistance level 157.20…

21 hours ago

WTI crude Wave Analysis 13 November 2024

- WTI crude oil reversed from the multi-year support level 66.70 - Likely to rise…

21 hours ago

Japanese inflation continues to rise

Japanese inflation is rising, with corporate goods prices inflation accelerating to 3.4% y/y in October,…

24 hours ago

This website uses cookies