The Dollar Index is trading almost flat during the early part of Wednesday’s session. The relative stillness of the greenback comes as many are already looking towards tomorrow’s publication of the US CPI for May. Should it provide a shockingly high number, this could force the hand of the Fed in accepting the need for earlier tapering of its current dovish policies. On the other hand, should the inflation figure come in below feared levels, the central bank will feel vindicated in its approach, with the US dollar likely to lose support in such a scenario.
Stocks fluctuated with lower volumes than usual in Europe on Wednesday, following a mixed trading session in Asia where losses in Japan were offset by gains from Chinese shares. While investors search for new bullish catalysts to drive stock prices higher, there are still no significant bearish market drivers to trigger a sell-off either. More and more traders, who may have initially been skeptical towards the “transitory” effect of inflation, now start to consider the possibility that central banks may have been right to display such confidence about the current mounting price pressure. Of course, investors will still need some confirmation, like tomorrow’s US CPI report, before taking any decision on how to manage their exposure towards riskier assets. Meanwhile, energy and Forex traders will be focusing on today’s US Crude Oil Inventories data as well as the Bank of Canada’s decision on rates where a surprise is always possible.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.