US consumer prices rise again
Daily Currency Update
Data showed on Tuesday that consumer prices in the US rose by 8.5% in March year-over-year, following a 7.9% annual gain in February. The US dollar initially slid on the back of the news, but picked up again against a basket of major currencies. The increase reinforces pressure on the Federal Reserve to raise interest rates to help curb high inflation.Most of the price gains were driven by high gasoline prices, as well as food costs. Without counting volatile commodity components like oil and grains, core inflation rose less than forecasted to 0.3% from a month earlier and 6.5% from a year ago. The US Dollar Index was up 0.11% at 100.04 at the time of writing.
Key Movers
The euro struggled against the US dollar on Tuesday following the release of US inflation data, while the pound climbed modestly against USD. News of more intense fighting in the Russia-Ukraine crisis has sent a new wave of risk aversion through the global markets. The situation with China’s COVID response is being monitored closely, as this could have global repercussions on supply chains. Both of these factors could be contributing to the US dollar’s current strength. EURUSD was down 0.31% at around 1.0849, while GBPUSD was up 0.02% at around 1.3031 at the time of writing.Expected Ranges
- EUR/USD: 1.085 - 1.0894 ▼
- GBP/USD: 1.3001 - 1.3049 ▲
- AUD/USD: 0.7403 - 0.7492 ▲
- USD/CAD: 1.2598 - 1.2661 ▼