Talking Points:

-All December CPI data meets expectations.

-Continuing Claims disappoint at 3030K vs. 2850K expected.

-Initial Jobless Claims slightly better than expected at 326K vs. 328K expected.

Data met expectations for December’s CPI readings with the MoM figure coming in at 0.3% while the Ex Food and Energy print came in at 0.1%. After WTI Crude hit seven-month lows in November, the rebound in energy prices last month helped support the headline figure.

Although CPI met expectations, continuing claims disappointed market estimates by coming in at 3030K vs. 2850K expected, leading to a brief US Dollar weakness. The Bureau of Labor Statistics noted that the uptick in claims figures could be attributed to seasonal distortion.

Dec_US_Inflation_Meets_Expectations_But_USDJPY_Lower_body_Picture_2.png, December US Inflation Meets Expectations, But USDJPY Lower

USDJPY 1-minute Chart: January 16, 2014 Intraday

Dec_US_Inflation_Meets_Expectations_But_USDJPY_Lower_body_Picture_1.png, December US Inflation Meets Expectations, But USDJPY Lower

Source: FXCM Marketscope

The greenback initially saw some chop at the print, but USD pairs and US Treasury yields continue to come under pressure following the release. The USDJPY fell from ¥104.56 ahead of the report to a session low of 104.34 at the time this report was written.

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--- Written by Gregory Marks, DailyFX Research

--- Written by Christopher Vecchio, Currency Analyst