U.S. CPI Data Take on Bigger Importance After Markets Plunge
Wednesday’s report on the U.S. consumer price index will be the most closely watched in recent memory, with investors seeking to understand the recent plunge in the stock and bond markets. They’ll probably need to look beyond the main numbers for the full story. The core CPI, which excludes food and energy, rose 1.7 percent in January from a year earlier, compared with 1.8 percent in December, according to the median projection of economists ahead of the Labor Department data. Viewed another way, though, inflation may be higher: A 0.2 percent monthly rise in the same index, as economists forecast, would result in a three-month annualized rate of 2.3 percent, according to analysts at Wells Fargo Securities. That would match the fastest pace since February 2017. Read More @ https://www.bloombergquint.com/markets/2018/02/13/u-s-cpi-report-takes-on-bigger-importance-after-markets-plunge
Explainer: Rising U.S. inflation and what it means for markets
U.S. financial markets have been roiled recently by something neither the economy nor investors have had to contend with for the better part of a decade: concerns they may soon have to reckon with rising inflation. The S&P 500 .SPX.INX is down more than 7 percent from its lifetime high hit on Jan. 26, after falling as much as 10.2 percent, and yields on the benchmark U.S. 10-year note US10YT=RR have climbed to a four-year high, largely due to worries over inflation. What exactly is inflation, aside from a rise in prices for goods and services, and why is it having such a strong effect on markets? Read More @ https://www.reuters.com/article/us-usa-inflation-explainer/explainer-rising-u-s-inflation-and-what-it-means-for-markets-idUSKCN1FX32F
WHAT IS THE USD INDEX SAYING?
TODAY’S NEWS THAT MIGHT AFFECT YOUR TRADES.
- 7.50am – Japan GDP is at standstill; USDJPY already hit the double bottom as predicted and now the question is – What is USDJPY next move? We decide to hold till CPI data is released and the Support Breaks. = Japanese yen hits 5-month high, breaks through technical barrier – https://www.marketwatch.com/story/japanese-yen-hits-5-month-high-breaks-through-technical-barrier-2018-02-13?siteid=rss&rss=1
- 3.00pm – EUR will take the lead with GERMAN critical GDP data release which is widely expected to be good for EUR next rally – we maintain EURUSD @ 1.30 for now. We buy with any new lows.
- 4.00pm – Weidsmann speaks and the market will move – and we believe he will maintain Hawkish moving forward.
- 5.00pm – Italian will release their GDP and we don’t expect much movement.
- 6.00pm – EURO will release their GDP and we are expecting the data to be good after yesterday MARIO DRAGHI claims that EURO-ZONE recession is over. We maintain BUY if there is a fall.
- 9.30pm – US will release critical CPI data – US is caught with way the market will be not in favor for the USD – if the inflation is high the US MARKET will correct because of FED RISING RATES; if the CPI is low then the FED have bigger headache of what to do next. We will watch carefully today @ the USD INDEX and see what happens. Either way we maintain SELL only if critical support breaks. https://www.reuters.com/article/us-usa-inflation-explainer/explainer-rising-u-s-inflation-and-what-it-means-for-markets-idUSKCN1FX32F
- Keep your eyes open to Retail sales also – which is expected to be good.
- 11.30pm – US will release the Crude Oil Inventories which is expected to have no change or negative – we maintain BUY for OIL.
Overall the market will be cautious over USD and US CPI – Currency Markets will be ahead for a volatile day.
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