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Weekly jobless claims dropped to 320K – a new low since January 2008. They were expected to stand on 334K, similar to 335K last week (marginally revised from 333K). Continuing claims dropped below 3 million to 2.969 million. They were estimated to slide back to the 3 million level, after jumping above this round number last week. The headline Consumer Price Index (CPI) was expected to rise by 0.2% MoM (0.5% last time before revisions) and 2% YoY (previous 1.8%). Core CPI, which is closely watched by the Fed, was expected to rise 0.2% (previous +0.2%)  MoM and 1.7% YoY (previous 1.6%). All inflation numbers came out exactly as expected.

EUR/USD has been trading steadily under 1.33 and USD/JPY climbed back above 98.20 before the publication. A bigger mover has been British pound: GBP/USD climbed towards 1.56 on excellent retail sales numbers. The dollar is now higher, with EUR/USD below 1.3270, USD/JPY at 98.50.

Update: EUR/USD is hit hard: falling around 60 pips to 1,3234.

The Empire State Manufacturing Index was expected to edge up from 9.46 to 10 points. Here we have a disappointment: the figure dropped to 8.24 points. This figure is overshadowed by employment and inflation.

This is not the end of the big bulk of US figures: we soon have the  TIC Long-Term Purchases (13:00 GMT), industrial output and capacity utilization rate (13:15) and most importantly the Philly Fed Manufacturing Index (14:00) which will be accompanied by the NAHB Housing Market Index.

Recent figures in the US have been relatively positive, and there is growing notion that the Federal Reserve will taper its bond buys in September: make the “Septaper”.

Further reading:  Septaper is a close call both for markets and the Fed