After Monday’s big dollar-bullish move, the foreign exchange market has been relatively mixed over the last 48 hours, not coincidentally mirroring the uncertainty traders are feeling toward future Federal Reserve policy.
U.S. consumer prices increased in October after two straight months of declines as the cost of goods and services rose, signs of firming inflation that further support expectations that the Federal Reserve will raise interest rates next month.
After some classic minimal data consolidation in the forex markets last week, traders are eagerly awaiting some top-tier economic reports (and hopefully accompanying volatility) this week. The first of these key reports, the U.S. October Consumer Price Index (CPI), was just released.
A six week winning streak in U.S. indices is on course to come to an abrupt end on Friday as this weeks’ commodity rout, likely combined with some profit taking in the absence of too much data, takes its toll.