US Dollar Deflates Further post-CPI
The upside momentum in the US Dollar – tracked by the US Dollar Index - has now lost some vigour, returning to the 94.85/80 band.
US Dollar giving away gains on US data
After hitting fresh multi-day highs above the 95.00 handle, the index has surrendered some gains and returned to the 94.80 area in response to lower-than-expected US inflation figures for the month of March.
In fact, key headline consumer prices rose at an annual pace of 0.9%, down from February’s 1.0% advance and lower than the 1.1% initially forecasted. In the same direction, Core consumer prices rose 2.2% over the last twelve months vs. 2.3% expected.
On the bright side, Initial Claims rose by 253K during the week ended on April 8, the lowest level since 1973.
Ahead in the session, market participants will closely follow the speeches by Atlanta Fed D.Lockhart and FOMC Board Member J.Powell regarding the potential timing of the next rate hike by the Fed.
US Dollar relevant levels
The index is advancing 0.03% at 94.78 with the next hurdle at 95.51 (38.2% Fibo of 98.59-93.62) followed by 96.34 (55-day sma) and finally 96.42 (high Mar.28). On the other hand, a break below 93.62 (2016 low Apr.12) would target 93.16 (monthly low May.15 2015) en route to 92.52 (monthly low Aug.24 2015).