Dollar Rises By Default, US Inflation Next
|Market Drivers July 12, 2018
Trump continues to roil NATO
EZ growth cut, US inflation on tap
Nikkei 1.17%
Dax 0.32%
Oil $71/bbl
Gold $1244/oz.
Bitcoin $6190
Europe and Asia:
No Data
North America:
USD CPI 8:30
It’s been a quiet choppy night of trade in the FX market with the dollar still bid after yesterday’s breakout that saw USDJPY take out the 112.00 figure.
There was no economic data on the calendar but the euro received some bad news when the EC reduced growth estimates for the region to 2.1% from 2.3% earlier. Donald Trump’s constant pressure to renegotiate trade tariffs as well as demands for much larger increases in defense spending for NATO allies is clearly having a negative impact on sentiment in the region which may face slower growth from contraction of trade as well as higher fiscal deficits from increased defense spending.
NATO held an emergency meeting, in response to Mr. Trump’s bellicose demands yesterday as the allies scrambled for a policy solution.
With Europe pressured by Trump, UK pressured by Brexit and commodity dollars pressured by trade war fears, the greenback is rising by default for now. As long as the US economy continues to perform that dynamic should last. To that end, today’s CPI data will be the main economic event of the day with traders looking for a steady 0.2% rise. Inflation has remained steady above the 2% level keeping Fed on hawkish stance, with even such doves as Charles Evans stating that he was more inclined to hike now.
With markets entering the summer doldrums season, price action may be slow as the day progresses, although the constant geopolitical tension caused by Trump may keep markets on edge, FX appears to have settled into narrow ranges for now as traders look for fresh catalysts to trade.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.