Jump to content

Investors brace for the highest inflation reading in nearly 40 years


Recommended Posts

image.png

image.png

image.png

If the consensus is correct, the last time inflation was this high was in the early years of the Reagan administration – as the U.S. found itself amid a steep and persistent recession.

The Labor Department on Friday morning will release November’s consumer price index, a gauge that measures the cost of dozens of items. The index covers common goods including gasoline and ground beef, but extends into more detailed purchases such as frozen vegetables, indoor plants and flowers and pet supplies.

Full article on CNBC

Link to comment

image.png

SUMMARY
In the United States, the core inflation rate tracks changes in prices that consumers pay for a basket of goods which excludes volatile food and fuel costs.
 
In the United States, unadjusted Consumer Price Index for All Urban Consumers is based on the prices of a market basket of: food (14 percent of total weight), energy (9.3 percent), commodities less food and energy commodities (19.4 percent) and services less energy services (57.3 percent). The last category is divided by: shelter (32.1 percent), medical care services (5.8 percent) and transportation services (5.5 percent).
 
Inflation Rate MoM measures month over month change in the price of goods and services.
 
 
13:30 UK Time
Link to comment

USD Dips, Gold Picks Up on 40yr High Inflation Having Matched Estimates.

 

USD, CPI Price Analysis & News

  • US CPI at 40yr High, Matching Estimates
  • USD Drops In Response Given Expectations for Upside Surprise

U.S. Consumer Sentiment Sees Small Gains Through Holiday Season

US CPI Hits 40yr High Matching Expectations

DATA RECAP: The headline rate rose 0.8% on the month, taking the yearly rate to 6.8%, in which the headline rate printed in line with expectations. The core readings also matched estimates at 0.5% m/m and 4.9% y/y. Once again, the more sticky components such as shelter costs rose 0.5%, further underscoring the recent decision by Chair Powell to retire the word transitory, when discussing inflation.

US Inflation Components

USD Dips, Gold Picks Up on 40yr High Inflation Having Matched Estimates

Source: BLS

How to Trade After a News Release

MARKET REACTION: Now while the headline was a near 40yr high, given that President Biden noted that the November data will not reflect the lower energy costs, traders had geared for a slightly firmer than expected number. Therefore, meaning that an in-line print would be a disappointment for USD bulls. That being said, this is only a short term move and with the FOMC next week, I would be surprised whether there would be a fully-fledged pullback in the greenback and thus expect dips to be bought.

However, the data provides a reminder that when trading economic data, the most important factor for markets is “how does it compare to expectations”. It doesn’t matter if its extremely high, low or the same as the prior month or year, what matters is how the data deviates from expectations.

USD, US RATES & GOLD REACTION TO US CPI

USD Dips, Gold Picks Up on 40yr High Inflation Having Matched Estimates

Source: Refintiv

By Justin McQueen, Strategist, 10th December 2021. DailyFX

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      22,100
    • Total Posts
      92,957
    • Total Members
      42,478
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    Traph
    Joined 02/06/23 04:45
  • Posts

    • Hey fellow traders! I wanted to share some exciting news with you all regarding the AUDUSD currency pair. Over the past few days, I've been closely monitoring its movements, and I'm thrilled to report a significant development. The price has finally broken below the immediate support level at 0.6564, indicating a successful breakout. Now, here's the exciting part. The price is currently retracing towards this former support level, which has now transformed into a resistance zone. If the price fails to break and close above this resistance level, there is a high potential for a bearish push, with a target towards the major support at 0.6177. This presents a fantastic opportunity for us traders to profit from the downward movement, potentially gaining a massive 400 pips. Keep a close eye on the price action and watch for any signs of rejection at the resistance zone. If the bears take control, it could be a rewarding trade! Remember, always exercise caution and implement appropriate risk management strategies. Good luck and happy trading!  
    • Elliott Wave Analysis TradingLounge Daily Chart, 2 June 23,   AAVE Token/U.S.dollar(AAVEUSD) AAVEUSD Elliott Wave Technical Analysis Function: Reactionary(Counter Trend) Mode: Corrective Structure: Double Combined Position: Wave (Y) Direction Next higher Degrees: Wave ((2)) of Motive Details: Wave ((2)) may have ended at the level of 60.171. Five waves of rise and break of the level of 74.219 will support this idea. Wave Cancel invalid Level: 60.171 AAVE Token/U.S.dollar(AAVEUSD)Trading Strategy: Wave ((2)) may end at the level of 60.171, five rising waves will support this idea. but even so Price Remains in Bear Market Control As it is below the MA200 line, there is still a risk of entering a long position. AAVE Token/U.S.dollar(AAVEUSD)Technical Indicators: The price is below the MA200 indicating a downtrend MACD and RSI are Bearish momentum. TradingLounge Analyst: Kittiampon Somboonsod, CEWA Source : Tradinglounge.com get trial here!     Elliott Wave Analysis TradingLounge 4H Chart, 2 June 23,   AAVE Token/U.S.dollar(AAVEUSD) AAVEUSD Elliott Wave Technical Analysis Function: Follow Trend  Mode: Motive  Structure: Impulse Position: Wave 3 Direction Next higher Degrees: Wave (1) of Motive Details: Wave 3 is usually equal to 1.618 multiplied Length of wave 1 Wave Cancel invalid Level: 60.171 AAVE Token/U.S.dollar(AAVEUSD)Trading Strategy: Wave ((2)) may end at the level of 60.171, five rising waves will support this idea. but even so Price Remains in Bear Market Control As it is below the MA200 line, there is still a risk of entering a long position. AAVE Token/U.S.dollar(AAVEUSD)Technical Indicators: The price is below the MA200 indicating a downtrend MACD and RSI are Bearish momentum.
    • Look ahead to 2/6/23: US jobs; Baker Hughes rig count After the stronger than expected private payrolls number from ADP, risks would seem to be on the upside for the US non-farm jobs number on Friday.  Jeremy Naylor | Analyst, London | Publication date: Thursday 01 June 2023  IGTV’s Jeremy Naylor looks at USD/JPY as a potential trade. Outside of this watch Brent around the Baker Hughes rig count.            
×
×
  • Create New...