US Dollar posted moderate gains on Tuesday despite the uncertainty around the FOMC September decision. Futures on the US Dollar, which tracks the greenback against six major peers but mainly against Euro, rose by 0.18% to 95.29 level, recoiling from a 95.00 level on Monday. The European common currency index rose by 0.12% to an 89.19 level.
The odds of a rate hike almost halved after the final FED official speech before the Septembers meeting. There seem to be doubts raised over the need for an immediate tightening. Lael Brainard, the member of FOMC, called for caution when considering the timeliness of the rate hike. Saying that “the case to tighten policy preemptively is less compelling”. She also pointed out such issues as inflation, which is less responsive to labour market changes, slack in the employment and external risks which can still be transmitted over to the US economy. Despite the dovish tone Brainard mentioned the achievements of the US economy in reaching the inflation and employment targets. She stated that the inflation has not grown at the pace what FED originally hoped for.
The industrial production in China rose faster than expected, the August report that at the same time Retail Sales were in line with estimates.
UK consumer data was weaker than projected in August. Pushing Pound deeper against the Dollar. YoY CPI growth slowed to a 0.6%, while the Core CPI (which exclude some goods with volatile prices) rose by 1.3% missing the 1.4% projection. The Pound sunk half a percent to a 1.3260 level.
The Australian Dollar fell by 0.48% following the drop, what happened in the Iron ore futures. The prices of crude oil retreated after yesterday’s growth, WTI -2.18%, Brent -1.80%.
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