The general index of the US dollar recorded highs in the middle of the trading session today, Wednesday, the 10th of November, and a few hours before the announcement of the data of the US consumer price index, which is concerned with measuring inflation, as expectations indicate that the annual inflation in the United States of America will rise at the fastest pace since 1982 in October, an increase of more than 5.8% compared to 5.4% in September and to rise on a monthly basis by 0.6% with the continued rise in input and energy prices.
The producer price index came in line with expectations in October, according to data released on Tuesday, at 0.6%, while the core index declined to 0.4%.
The markets will monitor any strong rises in the inflation rate to see if the US Federal Reserve will take a step to accelerate its current plan by reducing purchases by $15 billion per month in December and raising interest rates after the program is completed, or will stick to its current plan.
US Federal Reserve Chairman James Bullard told CNBC Tuesday that he expects the US Federal Reserve to raise interest rates twice next year after completing a bond-buying program expected in the middle of the year.
Positive reading of the index that exceeded expectations, the US dollar will be the biggest beneficiary and will rise in the remainder of the session and vice versa if the reading comes in less than expectations, it will be negative for the US dollar index and positive for gold and commodity currencies.
The US dollar is trading at an increase of about 0.15% at levels of 94.10 in the middle of today’s session, after retreating for three consecutive sessions, benefiting from the rise in the yield on US Treasury bonds.
The yen is one of the most affected by the US dollar’s gains, as it loses about 40 points and is trading at 113.26 levels.
06/11/2024
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