USD: Long-awaited CPI may not tell us much – ING

FXStreet Insights Team FXStreet

Today’s US CPI for September ends a long drought of hard data due to the shutdown. But we don’t expect it to generate a material pick-up in FX volatility. Our call for core CPI is 0.3% MoM and 3.2% YoY – very close to the consensus 0.3%/3.1%. For headline CPI, we are fully aligned with the consensus 0.4% MoM/3.1% YoY, ING's FX analyst Francesco Pesole notes.

Fed can cut and signal more easing ahead next week

"Despite tariff-led price pressure in some sectors, there are indications that airfares, hospitality and housing should be a drag on the CPI basket. With headline and core close to 3.0%, the Fed can cut and signal more easing ahead when it meets next week. But markets are fully pricing in 50bp by year-end, and without any jobs data at hand, it will be hard to speculate much beyond the December meeting."

"A potentially more impactful development for FX is the ongoing commodity spillover of US sanctions on Russian oil producers. A few reports now suggest some Indian and Chinese refineries are considering halting imports of Russian oil. A meaningful reduction in Russian oil supply (which we didn’t see after previous sanctions) could drive Brent prices back to the 70-75$ range."

"These are levels that would drive some noticeable dollar appreciation. So far, the FX impact of the oil price spike has been particularly visible in a Norwegian krone rally and added pressure on the yen, which incidentally keeps discounting domestic risks."

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

AUD/USD sticks to positive bias above 0.7100; lacks bullish conviction

AUD/USD trades with a positive bias for the second straight day, holding above 0.7100 in the Asian session on Friday as softer US bond yields keep US Dollar bulls on the back foot. Furthermore, hawkish RBA Governor Bullock's comments boost rate hike bets and support the Aussie. However, the Fed's hawkish outlook, along with geopolitical uncertainties, limits USD losses and caps the pair.

USD/JPY approaches 158.00 as Japanese Yen resumes decline

USD/JPY is resuming its upside in the European session on Friday, refreshing two-week highs and nearing 158.00. The Japanese Yen extends losses, despite the Bank of Japan's (BoJ) expected rate hike to 1.25% and hawkish Governor Ueda's comments, as two surprise dissents against the rate hike weigh on it.

Gold keeps the bid tone in place; still below $4,400

Gold adds to the optimism seen in the second half of the week, trading with decent gains just below the $4,400 mark per troy ounce on Friday. The precious metal’s advance finds traction in declining crude oil prices and fresh selling pressure on the US Dollar.

Why altcoin season isn't coming back — and what stole its capital

If, after two years of being frozen in ice, Katara and Sokka woke you up to the crypto market, it would seem like 100 years have passed. With Bitcoin soaring to record highs just over a year ago, everyone expected a routine altcoin season, where investors take profits from the top crypto to chase higher returns in altcoins.

BoJ Recap: Not as hawkish as expected

The BoJ raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks. Governor Kazuo Ueda said the policy phase had changed.

BoJ Recap: Not as hawkish as expected

The Bank of Japan (BoJ) raised its short-term interest-rate target to 1.25% from 1.00% in a 7-2 vote, marking another step in the normalisation of monetary policy and widely matching what everyone has been expecting for weeks.