Dollar Might Shrug Off U.S. CPI And Retail Sales As Markets Lock In November Taper
XM Group | Sep 13, 2021 09:56AM ET
Is the inflation surge easing?
Inflation in America stood at a 13-year high in July according to the CPI measure, unchanged from the previous month, as supply constraints and pent-up demand continued to exert upward pressure on a broad range of prices. Those pressures might be easing, however, as the month-on-month rate is forecast to decelerate for the second straight month from 0.5% to 0.4% in August. That should bring the 12-month rate down a notch to 5.3%. Although this would still be well above the Fed’s 2% target, it would add credence to the view that the current surge is temporary.
On the other hand, a big miss in either the CPI or retail sales reports could knock the dollar back, helping the euro to claw back above its 50-day MA and climb towards the 61.8% Fibonacci retracement of the March-May uptrend at $1.1823, which lies slightly above the September top.
A Delta storm might be brewing
Beyond the upcoming releases, there’s a growing risk that US data over the next few weeks will disappoint just as the Fed is preparing to scale back its massive asset purchases. At this point, it may be too early to get enough of a read on how much of an impact the Delta outbreak is having on the US economy. But if the Fed ploughs ahead regardless, the recent patch of unusually low market volatility might come to an end.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.