Markets stabilize ahead of US CPI

Frank Walbaum

Important news this week

Fri, 11th, 08:00 CET UK Gross Domestic Product.
Fri, 11th, 14:30 CET US Core Consumer Price Index.

Markets stabilize ahead of US CPI

The Dollar is gaining ground again, while markets remain mostly flat after yesterday’s selloff. Stocks are slightly positive as investors look to stabilize, but the recovery remains limited ahead of today’s US CPI data.

Metals are moving lower as the stronger USD puts pressure on gold and silver. EURUSD, GBPUSD and AUDUSD are also under pressure, reflecting the renewed Dollar strength. Crypto is weaker as risk appetite remains cautious.

JPY pairs have also moved lower after a bearish week, although a slight rebound is now visible. The Yen remains closely watched after its recent strength, while traders assess whether the latest move has further room to continue.

Market talk

US CPI is the key event today and could bring fresh volatility across markets. A softer-than-expected inflation reading could quickly weaken the Dollar and support stocks, metals and risk-sensitive currencies. A stronger CPI number, on the other hand, could reinforce expectations for higher-for-longer US rates and provide further support for the USD.
For now, the market looks positioned cautiously after yesterday’s selloff. The Dollar’s recovery is an important short-term signal, while the reaction in equities and metals around the CPI release should show whether yesterday’s weakness was simply profit taking or the beginning of a deeper correction.

Tendencies in the markets

Equities weaker, USD stronger, crypto weaker, oil correcting, metals weaker, JPY sideways.

Author

Frank Walbaum

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