USD Waits Patiently For The Latest US Inflation Release
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US Dollar Eyes Important Inflation Data Ahead of the FOMC Meeting
Last week’s strong US jobs figures were counterbalanced by weaker-than-expected wage growth, leaving traders with no real impulse to drive the USD one way or another. Today’s inflation release however may give the greenback a jolt but with the FOMC meeting week – and with a 0.25% rate hike already baked in – today’s CPI numbers will need to miss expectations notably to spark a move.
Expectations for today’s inflation release centre on y/y inflation rising to 2.2% from a prior 2.1% while annual CPI ex-food and energy is expected to remain unchanged at 1.8%. Any tick-up to the upside will give slightly more credence to market expectations of four US rate hikes this year – although this is still an outlier – and give the greenback a boost.
.GBPUSD is currently stuck in a range with the downtrend line from late-January converging on the longer-term uptrend line and the shorter-term uptrend line from early-January. The stochastic indicator is pushing back towards overbought territory but still has room to move higher. Finally the pair is currently trading just above all three EMAs, indicating further GBPUSD upside may be on the cards.
GBPUSD Price Chart Daily Time Frame (October 15, 2017 – March 13, 2018)
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--- Written by Nick Cawley, Analyst
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.