Dollar Rises Before CPI, Euro Steadies Ahead of ECB
The dollar traded higher versus most of its major peers yet within tight ranges as investors await US inflation data for clues on the Federal Reserve’s monetary policy path. The euro steadied ahead of the European Central Bank policy decision.
The Bloomberg Dollar Spot Index rises as much as 0.2%, mainly driven by yen weakness; US 10-year Treasury yields up 1bp to 4.05%
Core CPI, a measure of underlying inflation excluding food and fuel, probably rose 0.3% for a second month, according to the Bloomberg survey median estimate.
Money markets fully price a quarter-point interest rate cut by the Fed next week and see 66bps of easing by year-end.
USD/JPY up by 0.3% to 147.85, gains a second day; the pair rose after Kyodo News reported that Sanae Takaichi told former prime minister Fumio Kishida she’s running for LDP chief.
EUR/USD is little changed at 1.1693; ECB is expected to keep rates unchanged.
Euro volatility is giving off a whiff of complacency heading into Thursday’s risk events as hedging costs are at their lowest for an ECB day since October, even as traders factor in the US CPI release.
GBP/USD slips 0.1% to 1.3513; UK estate agents are reporting the most widespread decline in rental properties since the pandemic as the prospect of higher taxes and tighter regulation prompts landlords to exit the market, a closely watched survey found.
Source : Bloomberg
