Here is what you need to know on Thursday, June 10:
Markets are experiencing the calm before the dual storm of US CPI and the ECB decision. The dollar has been holding up despite a drop in Treasury yields while gold and oil are on the back foot. Cryptocurrencies are consolidating Wednesday's gains.
The US dollar is at the upper end of its range ahead of the release of US Consumer Price Index figures. After April's jump, headline inflation is forecast to accelerate to 4.7% YoY and a 5% read could trigger a substantial upside move in the greenback. Core CPI is set to rise to 3.5% YoY.
Treasury yields have been on the back foot, with returns on 10-year bonds dropping below 1.50%, contradicting the uptrend in the dollar and the decrease in gold and oil prices. Inflation data is critical ahead of next week's Federal Reserve's all-important decision.
GBP/USD has been consolidating around 1.41 amid several concerns. The UK reported the highest number of daily cases since late February, as the Delta COVID-19 variant continues spreading despite Britain's well-advanced immunization effort.
The EU and the UK are at odds over the implementation of the Northern Irish protocols, with an EU official saying that patience is running thin. Outgoing Bank of England Chief Economist Andy Haldane said the economy is going "gangbusters" on Wednesday, but his upside impact on the pound have faded away.
Bitcoin has received a boost from El Salvador's decision to include the granddaddy of cryptocurrencies as a legal tender. Moreover, Interactive Brokers, one of the world's largest trading houses, will reportedly allow trading cryptos. Ethereum and other digital assets have also recovered.
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