The much talked about December Fed meeting is finally here, 8:00pm Wednesday will see the Fed announce a new funds rate after a 2 day FOMC meeting. Investors have over the months anticipated a hike in funds rate given the Feds decision to gradually raise rates. Inflation however seems to pose the biggest challenge to a rate hike as inflation numbers remain soft despite solid economic growth in the US. CPI numbers are expected in by 2:30pm analyst forecast show expectations of a rise to 0.4% from 0.1% in November. Lower than anticipated CPI numbers could hold back the much expected rate hike. The dollar in Tuesday's trading rallied on the back of impressive PPI data. Core PPI rose to a 6 year high of 0.3%. USD/CAD rose to 1.2891 before retreating to 1.2867.
Inflation in Britain can't be held down as CPI numbers rose by 0.1 percentage points to 3.1%. Core CPI was however unchanged at 2.7%. Mike Prestwood, National Statistics Head of inflation noted that CPI rose to a 6 year high, a spin off from higher prices of computer games and lower airfares. Falling cost of computer equipments however offsets higher inflation. Brexit negotiations are expected to move on to trade talks at the EU's summit next week after all the back and forth on the size of the divorce bill and North Ireland. Employment data will take center stage for the British pound in Wednesday's trading as the market expects the release of earnings index, claimant count change & unemployment rate. GBP/USD was stable for most part of Tuesday's trading.
EUR/USD took a plunge on the back of impressive Producer's Price Index in the US. It fell to 1.1717 before moving back to 1.1723. Disappointing ZEW data was shrugged off by investors as they believe the German economy is looking sharp and is leading the way for solid economic growth in the Euro-area. The lack of government in German puts a bit of worry in investors mind. Today will see the release of German CPI, Employment change and industrial production of the Euro-area.
NZD/USD maintained it's upward movement while AUD/USD fell to thepressures of positiv PPI in the US. Trading in the course of the Asia session was relatively stable as the market looks forward to minutes of the FOMC meeting.
On the commodities side, Gold fell to 1,236 in the course of Tuesday's trading but rose back up to 1,244. The yellow metal is taking a beating from positive US data and divestment to Bitcoin. Oil prices rose on the back of unexpected pipeline shut down in the UK. Brent crude rose to $ 65.
Inflation in Britain can't be held down as CPI numbers rose by 0.1 percentage points to 3.1%. Core CPI was however unchanged at 2.7%. Mike Prestwood, National Statistics Head of inflation noted that CPI rose to a 6 year high, a spin off from higher prices of computer games and lower airfares. Falling cost of computer equipments however offsets higher inflation. Brexit negotiations are expected to move on to trade talks at the EU's summit next week after all the back and forth on the size of the divorce bill and North Ireland. Employment data will take center stage for the British pound in Wednesday's trading as the market expects the release of earnings index, claimant count change & unemployment rate. GBP/USD was stable for most part of Tuesday's trading.
EUR/USD took a plunge on the back of impressive Producer's Price Index in the US. It fell to 1.1717 before moving back to 1.1723. Disappointing ZEW data was shrugged off by investors as they believe the German economy is looking sharp and is leading the way for solid economic growth in the Euro-area. The lack of government in German puts a bit of worry in investors mind. Today will see the release of German CPI, Employment change and industrial production of the Euro-area.
NZD/USD maintained it's upward movement while AUD/USD fell to thepressures of positiv PPI in the US. Trading in the course of the Asia session was relatively stable as the market looks forward to minutes of the FOMC meeting.
On the commodities side, Gold fell to 1,236 in the course of Tuesday's trading but rose back up to 1,244. The yellow metal is taking a beating from positive US data and divestment to Bitcoin. Oil prices rose on the back of unexpected pipeline shut down in the UK. Brent crude rose to $ 65.
