Dollar Indecisive after CPI, Sterling Down But Not Out after Poor GDP
| Action Insight Mid-Day Report 9-13-23 |
Dollar Indecisive after CPI, Sterling Down But Not Out after Poor GDP |
Dollar attempts to rally in early US session after modestly stronger than expected US consumer inflation data. But there is no clear follow through buying. Headline CPI's bounce back to a 14-month high was slightly above expectations. Meanwhile, core CPI's monthly reading also beat market forecasts. Yet, it appears that traders are not convinced that this set of data is strong enough to sway Fed much away from the policy path ahead. Whether there is another hike by the end of the year, after next week's expected pause, would remain largely a coin toss. Sterling was under some selling pressure after deeper than expected UK GDP contraction but there was also no clear follow through momentum. Indeed for now, Aussie is the worst performer for the day, followed by Yen, and then Swiss Franc. Kiwi is the best performer, followed by Dollar and then Euro and Canadian. The Pound is just mixed in the middle. Aussie will be a focus in the upcoming Asian session with Australian employment data featured. GBP/AUD is now pressing 1.9367 resistance turned support, 55 D EMA (now at 1.9377), as well as a medium term rising trend line. Strong bounce from current level will argue that pull back from 1.9967 has completed, and larger up trend from 1.5929 is ready to resume. On the downside, sustained break of 1.93 handle will indicate that it's at least in correction to the rise from 1.7218, and target 38.2% retracement of 1.7218 to 1.9967 at 1.8917. Let's see how it goes. In Europe, at the time of writing, FTSE is down -0.09%. DAX is down -0.55%. CAC is down -0.50%. Germany 10-year yield is up 0.0199 at 2.666. Earlier in Asia, Nikkei dropped -0.21%. Hong Kong HSI dropped -0.09%. China Shanghai SSE dropped -0.45%. Singapore Strait Times rose 0.14%. Japan 10-year JGB yield dropped -0.0001 to 0.710. |
USD/JPY Mid-Day Outlook Daily Pivots: (S1) 146.61; (P) 146.92; (R1) 147.40; More... USD/JPY's rebound from 145.88 extends higher today, but upside is still capped by 147.88 resistance. Intraday bias remains neutral at this point and more consolidations could be seen. But even in case of another pull back, near term outlook will remain bullish as long as 144.43 support holds. On the upside, firm break of 147.88 will resume larger rise from 127.20, to retest 151.93 high. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 23:50 | JPY | PPI Y/Y Aug | 3.20% | 3.20% | 3.60% | 3.40% | | 23:50 | JPY | BSI Large Manufacturing Conditions Q3 | 5.4 | 0.2 | -0.4 | | 06:00 | GBP | GDP M/M Jul | -0.50% | -0.20% | 0.50% | | 06:00 | GBP | Industrial Production M/M Jul | -0.70% | -0.50% | 1.80% | | 06:00 | GBP | Industrial Production Y/Y Jul | 0.40% | 0.50% | 0.70% | | 06:00 | GBP | Manufacturing Production M/M Jul | -0.80% | -0.90% | 2.40% | | 06:00 | GBP | Manufacturing Production Y/Y Jul | 3.00% | 2.70% | 3.10% | | 06:00 | GBP | Goods Trade Balance (GBP) Jul | -14.1B | -15.9B | -15.5B | | 09:00 | EUR | Eurozone Industrial Production M/M Jul | -1.10% | -0.70% | 0.50% | 0.40% | | 11:00 | GBP | NIESR GDP Estimate Aug | 0.20% | 0.30% | | 12:30 | USD | CPI M/M Aug | 0.60% | 0.60% | 0.20% | | 12:30 | USD | CPI Y/Y Aug | 3.70% | 3.60% | 3.20% | | 12:30 | USD | CPI Core M/M Aug | 0.30% | 0.20% | 0.20% | | 12:30 | USD | CPI Core Y/Y Aug | 4.30% | 4.30% | 4.70% | | 14:30 | USD | Crude Oil Inventories | -2.2M | -6.3M |
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