Dollar Unfazed by Core Inflation Uptick, Loonie Muted on GDP Contraction
| Action Insight Mid-Day Report 1-31-25 |
Dollar Unfazed by Core Inflation Uptick, Loonie Muted on GDP Contraction |
Forex markets remain largely subdued today, with Canadian Dollar being the exception as volatility rises ahead of the implementation of US tariffs tomorrow. Canada is reportedly well prepared to respond with retaliatory measures on US imports worth up to CAD 150B. This comes at a time when Canada’s economy is already under pressure, with November’s GDP data showing a larger-than-expected contraction. However, despite the looming economic strain, Loonie’s selloff remains contained for now, as traders assess the full impact of trade retaliation. Meanwhile, Dollar shrugged off the latest PCE inflation data, which showed an uptick in the headline rate while core inflation remained at elevated levels. Fed Governor Michelle Bowman noted at an event that while rate cuts are still expected, their timing will depend on incoming data, given persistent inflation risks. The latest data reinforces Fed’s cautious approach, suggesting that policymakers are unlikely to act at least until Q2. For the week, the broader currency market picture remains unchanged. Yen continues to lead as the strongest performer, followed by Dollar and Swiss Franc. Aussie remains the weakest, followed by Kiwi and Euro. British Pound and Loonie sit in the middle.... |
USD/CHF Mid-Day Outlook Daily Pivots: (S1) 0.9069; (P) 0.9087; (R1) 0.9114; More… Intraday bias in USD/CHF stays mildly on the upside for the moment. Correction from 0.9200 could have completed at 0.8964 already. Further rise should be seen to retest 0.9200 and then 0.9223 key resistance. On the downside, below 0.9058 minor support will turn intraday bias neutral first. Further break of 0.8964 will resume the fall from 0.9200 to 38.2% retracement of 0.8374 to 0.9200 at 0.8884 next. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 23:30 | JPY | Tokyo CPI Y/Y Jan | 3.40% | 3.00% | | 23:30 | JPY | Tokyo CPI Core Y/Y Jan | 2.50% | 2.50% | 2.40% | | 23:30 | JPY | Tokyo CPI Core-Core Y/Y Jan | 1.90% | 1.80% | | 23:30 | JPY | Unemployment Rate Dec | 2.40% | 2.50% | 2.50% | | 23:50 | JPY | Industrial Production M/M Dec P | 0.30% | 0.30% | -2.20% | | 23:50 | JPY | Retail Trade Y/Y Dec | 3.70% | 2.90% | 2.80% | | 00:30 | AUD | PPI Q/Q Q4 | 0.80% | 0.90% | 1.00% | | 00:30 | AUD | PPI Y/Y Q4 | 3.70% | 3.90% | | 05:00 | JPY | Housing Starts Y/Y Dec | -2.50% | -3.40% | -1.80% | | 07:00 | EUR | Germany Retail Sales M/M Dec | -1.60% | -0.20% | -0.60% | 0.00% | | 07:30 | CHF | Real Retail Sales Y/Y Dec | 2.60% | 0.60% | 0.80% | 1.40% | | 08:55 | EUR | Germany Unemployment Change Dec | 11K | 14K | 10K | | 08:55 | EUR | Germany Unemployment Rate Dec | 6.20% | 6.20% | 6.10% | | 13:00 | EUR | Germany CPI M/M Jan P | -0.20% | 0.10% | 0.50% | | 13:00 | EUR | Germany CPI Y/Y Jan P | 2.30% | 2.60% | 2.60% | | 13:30 | CAD | GDP M/M Nov | -0.20% | -0.10% | 0.30% | | 13:30 | USD | Personal Income M/M Dec | 0.40% | 0.40% | 0.30% | | 13:30 | USD | Personal Spending M/M Dec | 0.70% | 0.50% | 0.40% | 0.60% | | 13:30 | USD | PCE Price Index M/M Dec | 0.30% | 0.30% | 0.10% | | 13:30 | USD | PCE Price Index Y/Y Dec | 2.60% | 2.60% | 2.40% | | 13:30 | USD | Core PCE Price Index M/M Dec | 0.20% | 0.20% | 0.10% | | 13:30 | USD | Core PCE Price Index Y/Y Dec | 2.80% | 2.80% | 2.80% | | 13:30 | USD | Employment Cost Index Q4 | 0.90% | 1.00% | 0.80% | | 14:45 | USD | Chicago PMI Jan | 39.9 | 36.9 |
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