All Eyes on the Future of the U.S. Dollar After Core CPI Holds Steady

All eyes are on the future of the U.S. dollar, which rose following the release of the U.S. core CPI

14.02.2024

In the U.S. currency market yesterday, the U.S. dollar emerged as the strongest currency after the January CPI, released yesterday, showed a year-over-year decline from 3.4% in the previous month to 3.1%, while the core CPI remained steady at 3.9%.The EUR/USD pair fell from 1.0799 to 1.0700, hitting a new low for the year. On the weekly chart, the RSI for EUR/USD is trending downward and has formed a bearish pattern, so we should remain cautious of a continued decline.

In contrast to the rising USD/JPY, European currencies saw the CHF/JPY fall sharply. The CHF/JPY dropped from 170.876 to 169.398. While it avoided hitting a new low for the month, it still posted a significant decline of more than 1 yen. Since the CHF/JPY has already broken below the 20-day moving average on the daily chart and the RSI is trending downward, we should watch to see if the Swiss franc continues to decline during European trading hours.

Today, at 6:45 AM, New Zealand’s Food Price Index; at 3:30 PM, India’s Wholesale Price Index; at 4:00 PM, the UK’s Consumer Price Index, UK Retail Sales, UK Producer Price Index, and Norway’s GDP; at 4:30 PM, Hungary’s GDP;at 7:00 PM, the Eurozone GDP and Industrial Production; at 9:00 PM, the U.S. MBA Mortgage Applications Index; at 12:00 AM, the Canadian Consumer Sentiment Index and remarks by Bank of England Governor Bailey; at 12:30 AM, U.S. Weekly Crude Oil Inventories; and at 1:00 AM, the Russian Consumer Price Index. We will be closely monitoring the future direction of the U.S. dollar, which rose following the release of the U.S. Core CPI.