UK CPI data released yesterday came in at an annualized rate of 4.6%, compared to the expected 4.7, and down sharply from the previous month’s rate of 6.7%%. This has created more dovish expectations of the Bank of England.
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- UK CPI (inflation) data came in lower than expected yesterday, showing a sharp fall in the annualized rate from 6.7% to 4.6%, when 4.7% was widely anticipated. This will put pressure on the Bank of England to take a more dovish approach and eventually cut rates. This has weakened the Pound somewhat.
- After suffering its worst day in over one year just two days ago, the US Dollar has continued to recover, and remains within a valid long-term bullish trend, although this is not supported by sentiment on the Fed, which is now seen as likely to cut rates by 0.50% by July 2024. The Dollar’s gain has been especially strong against the Yen, with the USD/JPY currency pair having rebounded to trade above ¥151.40. This pair will still be attractive to trend traders on the long side.
- In the Forex market, the Japanese Yen has been the strongest major currency since today’s Tokyo open, while the New Zealand Dollar has been the weakest major currency.
- Stock markets look bullish, and the best day trades today are likely to be on the long side of certain major stock indices, with the NASDAQ 100 Index looking especially interesting.
- Crude Oil is continuing to fall, with WTI near to a 3-month low price, after US Crude inventories rise.
- US PPI data released yesterday came in much lower than expected, showing a drop of 0.5%, which is more evidence of a firm decline in inflationary pressure.
- US Retail Sales data released yesterday came in stronger than expected, which is more evidence that the US economy is heading to a soft landing.
- US Empire State Manufacturing Index data yesterday came in stronger than expected, which reinforces my previous point.
- Australian Unemployment data released earlier today came in slightly better than expected.
- There will be a release later of US Unemployment Claims data.