Forex Today: US Inflation Data Fails to Boost Dollar as Attention Focuses on PPI

Here's what you need to know to trade today Friday January 12:

The US dollar (USD) outperformed its rivals in an initial reaction to the US December inflation figures released on Thursday, but failed to retain its strength as US Treasury yields turned down later in the American session. Although markets remain relatively calm early on Friday, data from the US December Producer Price Index (PPI) could increase volatility heading into the weekend.

Inflation in the United States, measured by the variation of the Consumer Price Index (CPI) rose to 3.4% year-on-year in December, as reported on Thursday by the US Bureau of Labor Statistics (BLS). The core CPI, which excludes food and energy price volatility, rose 0.3% monthly, matching forecasts. He DXY Dollar Index It hit a five-day high of 102.76 following the inflation report, but closed the day flat below 102.50 as the 10-year US Treasury yield failed to hold above 4%.

Dollar Quote this week

The following table shows the percentage change of the US Dollar (USD) against major currencies this week.

USD EUR GBP CAD AUD JPY NZD CHF
USD -0.30% -0.47% 0.12% 0.23% 0.24% 0.11% 0.14%
EUR 0.32% -0.14% 0.44% 0.55% 0.57% 0.42% 0.47%
GBP 0.49% 0.19% 0.61% 0.72% 0.74% 0.61% 0.62%
CAD -0.11% -0.41% -0.58% 0.12% 0.15% 0.00% 0.03%
AUD -0.23% -0.54% -0.71% -0.11% 0.04% -0.14% -0.09%
JPY -0.27% -0.56% -0.72% -0.11% -0.01% -0.11% -0.10%
NZD -0.08% -0.39% -0.55% 0.04% 0.15% 0.16% 0.05%
CHF -0.13% -0.48% -0.63% -0.02% 0.10% 0.10% -0.05%

The heat map shows the percentage changes of the major currencies against each other. The base currency is chosen in the left column, while the quote currency is chosen in the top row. For example, if you choose the euro in the left column and scroll down the horizontal line to the Japanese yen, the percentage change that appears in the box will represent EUR (base)/JPY (quote).

During the Asian session, Data from China has revealed that the Consumer Price Index (CPI) rose 0.1% month-on-month in December, compared to the 0.5% decrease recorded in November. Other data from China showed that the trade surplus increased to $75.34 billion in December, from $68.39 billion. This figure exceeded the market forecast of a surplus of $74.75 billion. However, the Shanghai Composite and Hang Seng indices are trading unchanged. Meanwhile, US stock index futures record small losses in the early stages of the European session.

After the volatility of the American session, the pair EUR/USD it settled above 1.0950. European Central Bank chief economist Philip Lane will deliver a speech during Friday's European session.

The UK Office for National Statistics (ONS) reported on Friday that Gross Domestic Product (GDP) grew 0.3% monthly in November, after the 0.3% contraction registered in October. The ONS also announced that Industrial Production and Manufacturing grew by 0.3% and 0.4%, respectively, in the same period. He GBP/USD has not shown an immediate reaction to this data and is now moving up and down in a tight range above 1.2750.

After advancing to its highest level in a month near 146.50, the USD/JPY reversed direction and closed negative on Thursday. The pair remains lower early on Friday and is trading around 145.00.

The price of Gold benefited from the decline in US bond yields in the second half of trading on Thursday and continued to rise during the Asian session on Friday. At the time of writing, XAU/USD is holding on to marginal daily gains above $2,030.

Source: Fx Street

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