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Better than expected inflation figures ahead of the Fed, with core inflation beating with 2.3% y/y and headline inflation standing at 1% y/y. Housing data  is  mixed.

The USD is slightly  stronger across the  board.

The US released a big bulk of  data after the  not-so-good retail sales report and ahead of the all important Fed decision. Core inflation was expected to remain at 2.2% y/y.

The US dollar looked OK ahead of the publications.

US data

  • Housing starts: previous 1.099 million, expected 1.15, actual: 1.178 million, with an upwards revision to 1.12.
  • Building permits: prev. 1.204 million, exp. 1.2 million, actual: 1.167 million,
  • CPI m/m: prev.0%, exp. -0.2%, actual: -0.2%.
  • Core CPI m/m: prev. +0.3%, exp. +0.2%, actual: +0.3%.
  • Core CPI y/y: prev. 2.2%, exp. 2.2%, actual: +.2.3%
  • CPI y/y: prev. 1.4%, exp. +0.9%, actual: +1%.

Currency reaction

  • EUR/USD traded under 1.1093, basically awaiting fresh news and still leaning lower after the Draghi rally. The pair now slides below 1.1080. Support awaits at 1.1070.
  • GBP/USD traded around 1.41, falling from the higher levels seen after the good British jobs report. Cable extends the losses below 1.4080.
  • USD/JPY was around 113.55. The yen dropped due to Kuroda’s words in parliament, a day after the BOJ refrained from policy action. The pair is at 113.78.
  • USD/CAD was around 1.3375  as oil prices  recovered. A  slight rise to 1.3383.
  • AUD/USD was around 0.7447, clinging on to support at 0.7440 ahead of the important Australian jobs report. The pair slips below support to 0.7424.
  • NZD/USD struggled with 0.66, still suffering thefall in milk prices. NZD/USD is  at -/6580, closer to support at 0.6550.

Yesterday’s retail sales report in the US was  quite mediocre, with beats in the headline but heavy downwards revisions weighed.

The big event for today is the FOMC decision: