The US dollar rebound significantly yesterday after the release of U.S. consumer prices data which increased more than expected in September. Higher than forecasted numbers anticipated some views in the market that U.S. interest rates may need to remain high. But the week’s sharp escalation of Middle East tensions ensured the mood remained cautious across markets.
The consumer price index (CPI) registered 3.7% on an annual basis, the same pace as in August, and rose by a larger-than-forecast 0.4% month-on-month, data from the Bureau of Labor Statistics showed. Economists had expected readings of 3.6% and 0.3%.
India Annual retail inflation rose 5.02% in September, down from 6.83% the previous month. A Reuters poll of 66 economists had forecast a rate of 5.50%. Retail inflation in June was 4.81%.
Meanwhile, the monthly underlying rate, which strips out volatile items like food and energy, came in at 0.3% compared to August and cooled to 4.1% year-on-year — in line with estimates.
Bullions and base metals face some selling pressure after the dollar sparked. As the Inflation report for September remained majorly in line with estimates. Crude oil retreated following the weekly inventory data.
Weekly EIA report saw US crude-oil inventories climb by a massive 10.2 million barrels, and one of reason for that was a huge drop in US crude exports that fell to 3.1M bpd last week, the lowest in two months and nearly 2M bpd below the previous week’s 5M bpd.
U.S. benchmark 10-year yields were last up 1.5 basis points (bps) at 4.611% US10Y , after earlier hitting two-week lows.
The dollar index which measures the currency against six major counterparts rose 0.78% at 106.5470 (At 11.50pm). MCX Gold future settled at 57918 down 0.04%. Silver at 69074 down 0.51%. Copper prices settled at 699.90 down 0.34%. Crude oil settled at 6896 down 1.72%. Natural gas settled at 278.50 up 0.25%.
Economic data and events scheduled today
Eurozone
At 12.15pm – German Buba President Nagel Speaks
At 2.30pm – Industrial Production m/m. Data is foreseen at 0.1% from -1.1%.
At 6.30pm – ECB President Lagarde Speaks.
Above data could have a neutral impact on the Euro.
U.K.
At 1.30pm- BOE Gov Bailey Speaks
At 7.00pm- CB Leading Index m/m. Previous was at -0.8%.
At 10.00pm – MPC Member Cunliffe Speaks
Above data could have a volatile impact on the pound.
China
At 7.00am –
CPI y/y. Data is foreseen at 0.2% from the previous 0.1%.
PPI y/y. Data is foreseen at -2.4% from previous -3.00%.
Tentative – Trade Balance. Data is foreseen at 510B from the previous 488B.
Tentative – USD-Denominated Trade Balance. Data is foreseen at 70.3B from previous 68.4B.
Tentative – New Loans. Forecast is 2500B from the previous 1360B.
Tentative – M2 Money Supply y/y. Forecast is 10.7% from the previous 10.6%.
Above data could have a volatile impact on the Chinese Yuan.
U.S.
At 6.30 pm- FOMC Member Harker Speaks
At 7.30pm –
Prelim UoM Consumer Sentiment. Data is foreseen at 67.20 from previous 68.10.
Prelim UoM Inflation Expectations. Previous was at 3.2%.
All day – IMF Meetings
All above data could have a volatile impact on the dollar.