The US dollar is giving back some of recent gains today, being the worst performing G10 currency on the day. US currency may become more volatile around 1:30 pm BST as a number of macro reports from the United States will be released. Traders will be offered PCE inflation, personal income, personal spending and durable goods orders data for April. PCE print will be the most closely watched as an upward revision to US Q1 GDP data, led to a jump in hawkish Fed pricing. Money markets currently price in around 20 basis points of tightening over the next two Fed meetings with a 38% chance of a 25 bp rate hike in June. Having said that, an upside surprise in PCE data could see those hawkish bets increase further. Nevertheless, it should be noted that CPI data for April which was already released came in below market expectations.
1:30 pm BST - US, data pack for April
- Core PCE. Expected: 4.6% YoY. Previous: 4.6% YoY
- Personal income. Expected: 0.4% MoM. Previous: 0.3% MoM
- Personal spending. Expected: 0.3% MoM. Previous: 0.0% MoM
1:30 pm BST - US, durable goods orders for April
- Headline. Expected: -1.0% MoM. Previous: +2.8% MoM
- Ex-transportation. Expected: 0.0% MoM. Previous: 0.2% MoM
Latest CPI and PCE readings. Source: Macrobond, XTB
EURUSD continues to drop with a sequence of lower lows and highs as US yields continue to climb. EURUSD is currently testing 23.6% retracement of the upward move launched in September 2022. A break below this support level could see that pair move towards 1.07 mark. Source: xStation5
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