Thursday has arrived which means traders and dealers from New York to Chicago to London will be in front of their screens this lunchtime, keeping a close watch on the latest developments in the US inflation picture.
Estimates are for a drop to 6.5% from just above 7% in November. Such a move would once again remind investors and central bankers that the global inflation story is improving after a hellish 2022! The greenback has been falling ever since inflation in the US began to peel off back in September/October ’22. This reaction may extend well into 2023. However, more signs of economic weakness and recession could spur its resurgence. In times of uncertainty and fear, the greenback provides a safe alternative to more risky and volatile currencies such as the pound, euro, and commodity bloc.
The data will be released at 13.30 UK time and could create a significant uptick in volatility across all financial assets. Please be aware if you will need to trade around this timeframe.
Written by Viv Savani. 8:13am, January 12th 2023
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