All Eyes Are On The US CPI Today, Kazuo Ueda Has Been Nominated As The Next Bank Of Japan Governor
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Market bulls have endless optimism this year, it is amazing. Whether it is funded or not, is yet to be seen.
US CPI
Inflation could help answer that question today.
A few indicators point at a certain uptick in inflation in January figures, and the expectation is that the US headline CPI may have slowed to 6.2% in January, from 6.5% printed a month earlier, on a yearly basis.
A sufficiently soft, or ideally a softer-than-expected CPI read today should give an additional boost to the equity bulls while a stronger inflation read could easily bring the Fed hawks back to the marketplace and send equities tumbling.
Forex
In the FX, the US dollar has seen a crowd of sellers above the 50-DMA. A strong inflation data could finally send the dollar index sustainably above its 50-DMA, while a soft reading will be a good reason to sell the rebound.
The EURUSD continues its own struggle around the 50-DMA.
In Japan, Kazuo Ueda has been nominated as the next Bank of Japan (BoJ) governor. There are rumours that the new BoJ leader could scrap the YCC policy. The yen was better bid in Tokyo, but the US CPI data is probably what will determine the short-term direction both in EURUSD and the USDJPY.
CPI
What everyone wants to see is a soft US CPI figure, a softer US dollar, strong equities, improved bonds, and stronger other currencies.
What everyone fears however is a figure that’s not convincingly softer.
The only sure thing is, the CPI days are known for their high intraday volatility.
Watch the full episode to find out more!
- 0:00 Intro
- 0:24 Mixed feelings about the market
- 3:51 All eyes are on the US CPI today!
- 7:13 FX update
- 8:39 Balloon update
Ipek Ozkardeskaya
Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
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