Market Roundup
•U.S. CPI rises more than expected in January
•US Jan Core CPI (YoY) 3.9%,3.7% forecast,3.9% previous
• US Jan Real Earnings (MoM) -0.3%, -0.2% previous
• US Jan CPI, n.s.a (MoM) 0.54%, -0.10% previous
• US Jan CPI Index, s.a 309.69, 308.85 previous
• US Jan Core CPI Index 314.44,313.22 previous
• US Jan CPI Index, n.s.a 308.42,307.99 forecast, 306.75 previous
• US Jan CPI (YoY) 3.1%, 2.9% forecast, 3.4% previous
• US Jan Core CPI (MoM) 0.4%,0.3% forecast,0.3% previous
• US Jan CPI (MoM) 0.3%,0.2% forecast,0.3% previous
• US Redbook (YoY) 2.5%, 6.1% previous
• US Jan Cleveland CPI (MoM) 0.5%, 0.4% previous
• US API Weekly Crude Oil Stock 8.520M 2.600M, forecast,0.674M previous
Looking Ahead Economic Data(GMT)
•No data Ahead
Looking Ahead Events And Other Releases (GMT)
• No Significant Events Ahead
Currency Summaries
EUR/USD: The euro declined against dollar on Tuesday after data showed U.S. inflation slowed less than expected in January. The U.S. consumer price index report pushed back market expectations that any interest rate cuts by the Federal Reserve were imminent. The consumer price index increased 0.3% last month after gaining 0.2% in December, the Labor Department's Bureau of Labor Statistics said on Tuesday. Investors will now focus on retail sales data on Thursday and producer price index (PPI) numbers on Friday. The market will also listen to comments from a slew of Fed officials this week. Several U.S. Fed officials, including Chairman Jerome Powell, said last week they want to see more evidence inflation will continue to decline before cutting rates.Immediate resistance can be seen at 1.0767(50%fib), an upside break can trigger rise towards 1.0828( 38.2%fib).On the downside, immediate support is seen at 1.0709(61.8%fib), a break below could take the pair towards 1.0673(Lower BB).
GBP/USD: The British pound strengthened against dollar on Tuesday after a report showed consumer inflation stayed elevated last month, smashing market expectations of imminent interest rate cuts by the Federal Reserve. After the data, expectations rose that the Fed will likely not cut rates until its June 11-12 policy meeting, with CME Group's FedWatch Tool showing a 74.4% chance for a cut of at least 25 basis points at that meeting. Expectations for a cut at the April 30-May 1 meeting declined to 36.1% from 60.7% on Monday. Next up on the economic calendar is the U.S. retail sales report on Thursday. Economists expect a 0.1% decline for January, from a 0.6% rise in December . Investors will also eye the UK inflation numbers on Wednesday. Immediate resistance can be seen at 1.2621(38.2%fib), an upside break can trigger rise towards 1.2675(23.6%fib).On the downside, immediate support is seen at 1.2576(50%fib), a break below could take the pair towards 1.2530(61.8%fib).
USD/CAD: The Canadian dollar posted its most significant drop in almost a year against the U.S. dollar as hotter-than-anticipated U.S. inflation data unsettled investors expecting an earlier initiation of Federal Reserve interest rate cuts.U .S. dollar rallied against a basket of major currencies as U.S. consumer prices rose 0.3% in January from December amid a surge in the cost of shelter.U.S. dollar rallied against a basket of major currencies as U.S. consumer prices rose 0.3% in January from December amid a surge in the cost of shelter. The loonie lost ground despite higher prices for oil, one of Canada's major exports. U.S. crude futures were up 1.4% at $78.01 a barrel on Tuesday. The loonie was trading 1% lower at 1.3585 to the U.S. dollar , its weakest intraday level since Dec. 13. Immediate resistance can be seen at 1.3577 (38.2% fib), an upside break can trigger rise towards 1.3649 (23.6% fib).On the downside, immediate support is seen at 1.3503(50% fib), a break below could take the pair towards 1.3435 (61.8% fib).
USD/JPY: The dollar rose sharply against the yen on Tuesday following data indicating that U.S. inflation climbed higher than anticipated in January, reinforcing expectation that the Federal Reserve will maintain interest rates unchanged in March. According to Data released on Tuesday, the Consumer Price Index (CPI) increased by 0.3% on a monthly basis in January, above the 0.2% gain forecast by economists. On a year-over-year basis, it increased 3.1%, compared to the expected 2.9% rise. Excluding the volatile food and energy components, the CPI increased 0.4% last month after rising 0.3% in December. The core CPI advanced 3.9% year-on-year in January, matching December's increase.The greenback surged to 150.88 yen , a three-month peak. It was last up 0.9% at 150.75 yenStrong resistance can be seen at 150.88(23.6%fib),an upside break can trigger rise towards 151.00(Psychological level).On the downside, immediate support is seen 149.46 (50%fib)a break below could take the pair towards 148.30(61.8%fib).
Equities Recap
European shares fell on Tuesday after a hotter-than-expected U.S inflation reading led traders to trim bets of early interest rate cuts from the Federal Reserve and as technology shares dropped from an over two-decade high.
UK's benchmark FTSE 100 closed down by 0.81 percent, Germany's Dax ended up by 0.95 percent, France’s CAC finished the day down by 0.84 percent.
Wall Street's main indexes tumbled on Tuesday after a higher-than-expected consumer inflation reading pushed back market expectations of imminent interest rate cuts.
Dow Jones closed down by 1.35 percent, S&P 500 ended down by 1.37 percent, Nasdaq finished the day down by 1.80 percent.
Commodities Recap
Gold prices fell below the critical $2,000 per ounce threshold to a two-month low on Tuesday, as a stronger-than-expected US inflation data dampened expectations of an early interest rate cut from the Federal Reserve.
Spot gold was down 1.3% at $1,993.29 an ounce by 01:56 p.m. ET (1856 GMT), its lowest since Dec. 13.U.S. gold futures settled 1.3% lower to $2007.2.
Oil prices rose as tensions continued in the Middle East and eastern Europe.
Brent futures settled 77 cents higher at $82.77 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 95 cents to settle at $77.87.
