Forex Today: Dollar shrugs off weak inflation, China worries mount, cryptos rise

Yohay Elam FXStreet

Here is what you need to know on Wednesday, September 15:

Optimism from weaker US inflation figures has made way to concerns about the US and also the Chinese economy, following weak data. Updated reads on UK and Canadian inflation and US industrial output are of interest. Cryptocurrencies have been marching higher while oil and gold have consolidated their gains.

Raging inflation debate: the US Core Consumer Price Index (Core PCI) missed estimates with 4% YoY initially sending the dollar down on hopes that the Federal Reserve delays tapering of its bond-buying scheme. While it convinced some that higher inflation was a result of rapid reopening and thus transitory others see its stagflationary – effects – a cooldown of the economy.

US Inflation Analysis: Team Transitory wins, dollar loses, why the trend may extend

US Consumer Price Index: Is stagflation next?

However, concerns about high stock valuations, covid and other factors resulted in another down day for shares, sending the safe-haven dollar back up – despite falling US Treasury yields. EUR/USD is hovering around 1.18 – dismissing upbeat comments from European Central Bank Christine Lagarde – AUD/USD is closer to 0.73 while gold is holding some of its gains around $1,800.

Chinese weakness: The world's second-largest economy reported a disappointing 2.5% YoY increase in Retail Sales. Industrial output also missed with 5.3%, weighing on prices of some commodities. The Delta covid wave is taking its toll. Beijing's ongoing crackdown on its tech companies, Evergrande's financial troubles, and another North Korean missile launch all added to the damp mood.

UK CPI is set to leap from 2% to 2.9%, adding pressure on the Bank of England to raise interest rates. The UK and the EU remain at odds about the Northern Irish protocol. GBP/USD is trading back around 1.38 amid dollar strength.

UK Inflation Preview: Soaring prices may give sterling a shot in the arm, open door to rate hike

USD/CAD is trading around 1.27 ahead of Canada's release of its inflation figures. WTI Crude Oil is holding onto gains, trading around $71 ahead of weekly inventory data.

Cryptocurrencies have been marching forward, with Bitcoin trading around $47,000 and Ethereum near $3,400. Ada is stable around $2.40 and Solana bounced from an earlier dip.

More Gold Price Forecast: 200-DMA holds the key for XAU/USD bulls

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

EUR/USD clings to gains around 1.1800

EUR/USD manages to regain composure and retests the 1.1800 region in quite a positive start to the week. The pair’s bounce follows the US Dollar’s offered stance post-SCOTUS ruling ahead of important US data and Fedspeak on Tuesday.

GBP/USD treads water near 1.3500 as BoE-Fed divergence debate stalls

GBP/USD spent Monday spinning in place as market participants await a fresh catalyst to break the pair out of its recent range. The BoE's February hold came with a surprisingly dovish 5-4 split, and UK Consumer Price Index data last week showed inflation easing to 3.0%, reinforcing the case for earlier rate cuts, with most economists now looking to April or March for the next move.

Gold climbs above $5,200 on geopolitical tensions, trade uncertainty

Gold price jumps to around $5,230 during the early Asian session on Tuesday. The rally of the precious metal is bolstered by heightened geopolitical tensions and global trade uncertainty following US tariff decisions. Traders brace for the US January Producer Price Index report on Friday for fresh impetus.

Solana DeFi platform Step Finance to close operations following treasury hack

The Solana based decentralized finance platform Step Finance announced it will end all operations effective immediately following a breach that drained its treasury.

Supreme Court nixes tariffs, Trump teases 15% global tariff

On February 20th, the Supreme Court ruled that Trump’s global tariffs under IEEPA authority were unconstitutional, effectively nullifying the framework. However, the relief was short-lived. Within hours, Trump floated a 15% blanket tariff under an alternative legal authority.

XRP recovers slightly as bearish sentiment dominates crypto market

Ripple is rising above $1.40 at the time of writing on Monday amid fresh tariff-triggered headwinds in the broader cryptocurrency market. The sell-off to $1.33, the token’s intraday low, can be attributed to macroeconomic uncertainty, geopolitical tensions and risk-averse sentiment among other factors.