Despite stronger than forecasted inflation data, the dollar edged lower against its major counterparts as markets weighed that the Federal Reserve will keep rates unchanged next week.
U.S. consumer prices accelerated by more than expected on a yearly basis in August, as a sharp uptick in gas prices contributed to lingering inflationary pressures in the world’s largest economy that may impact the Federal Reserve’s interest rate path for the rest of the year.
The Labor Department’s closely-watched consumer price index (CPI), a measure of price gains, increased by 3.7% annually during the month, up from 3.2% in July and faster than economists’ estimates of 3.6%. Month-on-month, the CPI reading was 0.6%, picking up the pace from 0.2% and in line with projections.
Bullions extended their fall for a second consecutive day and settled at a fresh three-week low. The most-active contract prices reached their lowest since August 22, 2023. Crude oil prices retreated slightly yesterday, however rebounded today as markets turned their attention back to a tighter crude supply outlook for the rest of 2023 with demand set to stay robust through to next year.
MCX Gold future settled at 58593 down 0.06%. Silver at 71419 down 0.72%. Copper prices settled at 732.70 up 0.08%. Crude oil settled at 7385 up 1.89%. Natural gas settled at 230.40 up 6.13%
Economic data and events scheduled today
Japan
At 10.00am – Revised Industrial Production m/m. Data is foreseen at -2% from previous -2%.
Above data could have a neutral impact on the Yen.
India
At 12.00 – WPI Inflation YoY (August). Data is foreseen at -0.60% from previous -1.36%.
Above data could have a neutral impact on the Indian Rupee.
Eurozone
At 5.45pm – Main Refinancing Rate. Data is foreseen at 4.25% compared to previous 4.25%.
Monetary Policy Statement at the same time.
At 6.15pm – ECB Press Conference.
All above data could have a volatile impact on the Euro.
CANADA
At 6.00pm – Wholesale Sales m/m. Data is foreseen at -2.0% previous was at -2.8%.
Above data could have a negative impact on the dollar.
U.S.
At 6.00pm –
Core PPI m/m. Data is foreseen at 0.2% previous was at 0.3%.
Core Retail Sales m/m. Data is foreseen at 0.4% from previous 1.0%.
PPI m/m. Foreseen at 0.4% from previous 0.3%.
Retail Sales m/m. Data is foreseen at 0.2% from the previous 0.7%.
Unemployment Claims. Data is foreseen at 225k from previous 216k.
At 7.30pm Business Inventories m/m. Data is foreseen at 0.1% from previous 0.0%.
At 8.00pm- Natural Gas Storage. Previous was at 33B.
All above data could have a negative impact on the dollar.
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