Greenback Unaffected by Soaring PPI inflation
09.11.2018, 14:19

Greenback Unaffected by Soaring PPI inflation

The US dollar slipped on Friday and failed to appreciate after strong inflation PPI inflation and the dollar index was trading only marginally higher on the day, well down from its daily highs reached earlier in the day.

The latest data showed that US PPI inflation accelerated higher to 2.9% year-on-year in October, up from 2.6% previously, while analysts had expected a slowdown to 2.5%. Moreover, the core inflation gauge also rose, although marginally and printed 2.6% from 2.5% previously. Monthly changes also rose more than doubled.

Investors will now focus on the Michigan consumer sentiment index for November, which is seen declining slightly to 98.0 from 98.6 in October. However, it still remains very optimistic. Moreover, wholesale inventories will be released shortly after.

US stocks are set to open 0.5% lower as investors took profits from this week’s rally and sentiment worsened after yesterday’s FOMC decision, where the Fed confirmed it is ready to continue raising rates at the current pace, despite the recent correction on the equity markets.

US bond yields were also lower on the day, but rose after the PPI report, with the 2-year yield just 5bps shy of the psychological level of 3.0%.  

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Analysis and opinions provided herein are intended solely for informational and educational purposes and don't represent a recommendation or an investment advice by TeleTrade. Indiscriminate reliance on illustrative or informational materials may lead to losses.

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