Major pairs are moving sideways in forex as the focus shifts to EU projections and US CPI
The US dollar extends its side move in forex with the DXY index trading near the mid-95.00 after a flat close on Wednesday as investors await the next big catalyst. The European Commission will publish its economic growth forecasts during European trading hours. In the second half of the day, weekly data on initial jobless claims and the January Consumer Price Index (CPI) will be included in the US economic record. During the final US session, Bank of England Governor Andrew Bailey will deliver a keynote address.
January CPI in the US »a brief overview of the market
While demand seen on Wednesday at the 10-year US Treasury auction was relatively weak, the benchmark 10-year US Treasury yield remains in a consolidation phase above 1.9%. Meanwhile, US equity futures indices fell 0.2% to 0.3% early Thursday, suggesting investors have become cautious ahead of the inflation data. Annual CPI is expected to hit a new four-decade high of 7.3% in January, up from 7% in December.
US Inflation Snapshot: Core CPI Above 6% Could Trigger Next US Dollar Recovery
WTI (West Texas Intermediate) oil barrel fluctuated below $ 90.00 for the second consecutive day on Thursday. Data from the US showed crude oil inventories fell by 4.7 million barrels last week, compared to market expectations for a 0.36 million barrel increase, but that impression did not hold up and it failed to stimulate oil prices.
The EUR / USD is trading in a very tight range above 1.1400 for the second consecutive day on Tuesday. The Governing Council of the European Central Bank and Bundesbank President Joachim Nagel have expressed support for a rate hike in 2022, but such comments have been largely ignored by market participants.
GBP / USD advanced towards 1.3600 on Wednesday but lost its bullish momentum. “There is a case for a measured rather than an activist approach to political decision making,” said Huw Pill, chief economist at the Bank of England.
The price of gold hit a two-week high above US $ 1,830 due to falling US Treasury yields and began to consolidate gains.
The USD / JPY pair reached a new monthly high near 115.70 on Thursday morning in Europe, but the pair is struggling to gain momentum.
The Bitcoin it is struggling to make a decisive move either way and remains relatively calm at around $ 44,000 USD. Ethereum gained nearly 4% on Wednesday, but is already down 2% on Thursday, trading close to $ 3200 USD.
By Eren Sengezer, FXStreet
Eren Sengezer holds a BA in Economics from California State University of Northridge (CSUN). You have been on the CSUN dean’s list three times during your time at university. In 2009 you received the “Certificate of Distinction in the Study of Economics” award from the CSUN.
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