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Britain’s Inflation Hits 5-Year High of 3%

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USD

On Tuesday, the Greenback hit new highs vs. a basket of major currencies, backed by a rise in Treasury yields following a report that U.S. President Donald Trump was supporting a policy hawk as the next head of the Federal Reserve.

On the release front, The New York Fed's business conditions index published yesterday showed its highest reading since September 2014.

  • The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.9% at 93.395 pips, the index had stooped to a 17-day low of 92.749 on Friday.

EUR

The single currency declined by 0.24% vs. the U.S. dollar, as the Greenback rose amid Speculation over Fed Leadership. On the economic calendar for Tuesday, traders are awaiting German ZEW Survey, which is expected to hit 20 from 17.

GBP

The Sterling pound rose as much as 0.18% vs. the Greenback at $1.3277 as UK inflation jumped to its highest since April 2012. According to the Office for National Statistics, the UK’s Consumer Prices Index (CPI) inflation rate was 3% in September, up from 2.9% in August as Brexit continues to raise the cost of living in the UK.

In terms of release, traders are awaiting comments by BoE Governor Mark Carney later in the day.

JPY

The Greenback was flat vs. the JPY, with USD/JPY at 112.18. No important reports are due from Japan today.

Gold

Earlier today, gold prices traded under pressure, sinking below the key $1,300-level as expectations mounted that the next head of the Federal Reserve will be more hawkish.

U.S. President Donald Trump is scheduled to meet with Fed Chair Janet Yellen on Thursday as part of his search for a new candidate for her position, a source familiar with the planned meeting said.

Trump told reporters late last month he had met with four candidates to lead the U.S. central bank and would make a decision “over the next two or three weeks.” 

Gold Futures - Dec 17 fell as much as 0.78%, to settle at $ 1,292.89.

Oil

Crude prices settled on Tuesday, after jumping to the highest level in around three weeks in the prior session, as Iraqi forces controlled the oil-rich city of Kirkuk while Asian shares held firm on optimism about future profits.

Crude Oil WTI Futures rose as much as 0.29%, to settle at $ 52.02, while Brent Oil Futures - Dec 17, was up 0.42% at $58.06.

Economic Calendar (all times in GMT)

  • GBP BOE's Carney, Ramsden, and Tenreyro Appears Before Treasury: (GMT 8:15).
  • GBP Consumer Price Index (YoY) (SEP): (GMT 8:30) – Important – Forecast (3.0%) – Previous (2.9%).
  • GBP Core Consumer Price Index (YoY) (SEP): (GMT 8:30) – Important – Forecast (2.7%) – Previous (2.7%).
  • EUR Euro-Zone ZEW Survey (Economic Sentiment) (OCT): (GMT 09:00) – Important – Forecast (N/A) – Previous (31.7).
  • EUR German ZEW Survey (Economic Sentiment) (OCT): (GMT 09:00) – Important – Forecast (20) – Previous (17).

Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM Capital Limited. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.

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