🔰 DAILY QUICK MARKET UPDATES 🔰
⚠️️ #USD ⚠️️
⛔ US CPI Comes in Hotter than Expected! Is a 75bps Rate Hike Locked in? This has been the Fed’s biggest worry: that inflation would become “entrenched” in the economy.
⛔ As a result of the data, not only does are the markets pricing in an 84% chance of a 75bps rate hike next week, but according to the CME’s FedWatch Tool, markets are also pricing in a 16% chance of a 100bps hike!
⚠️️ #USD ⚠️️
⛔ US CPI Comes in Hotter than Expected! Is a 75bps Rate Hike Locked in? This has been the Fed’s biggest worry: that inflation would become “entrenched” in the economy.
⛔ As a result of the data, not only does are the markets pricing in an 84% chance of a 75bps rate hike next week, but according to the CME’s FedWatch Tool, markets are also pricing in a 16% chance of a 100bps hike!
⚠️️ #GBP ⚠️️
🔰 What Will Happen to GBP/USD if the UK Surprises With Higher CPI?
⛔ Expectations are for a headline print of 10.1% YoY and a Core CPI print of 6.4% YoY. If the data is stronger than expected, will GBP/USD move higher? It may, but most likely not to the extent that the US Dollar did after the stronger US CPI.
⛔ The BOE, which is expected to hike 75bps next week, already warned markets of a potential 13% CPI reading in October and a recession beginning in Q4. Therefore, markets have been pricing in a potential higher inflation reading since the last BOE meeting (and GBP/USD is still much lower!).
🔰 What Will Happen to GBP/USD if the UK Surprises With Higher CPI?
⛔ Expectations are for a headline print of 10.1% YoY and a Core CPI print of 6.4% YoY. If the data is stronger than expected, will GBP/USD move higher? It may, but most likely not to the extent that the US Dollar did after the stronger US CPI.
⛔ The BOE, which is expected to hike 75bps next week, already warned markets of a potential 13% CPI reading in October and a recession beginning in Q4. Therefore, markets have been pricing in a potential higher inflation reading since the last BOE meeting (and GBP/USD is still much lower!).