The US Dollar index was flat today as the greenback was somewhat directionless during the trading session. Overall though, fundamentals looked really negative for the US currency, meaning that it has room for downside.
The US Bureau of Labor Statistics reported that the seasonally adjusted Producer Price Index rose 0.1% in May. While the reading was within market expectations, it was a slowdown from the April’s 0.2% growth. In fact, it was the slowest pace of growth in almost a year.
Now, traders wait for tomorrow’s release of the Consumer Price Index. The Federal Reserve closely watches the indicator, making it very important for assessing the next move of the US central bank. Ahead of the report, analysts predicted that consumer inflation will also demonstrate a slowdown, from 0.3% in April to 0.1% in May.
Talking about the Fed, speculators continue to price in an interest rate cut later this year. Indeed, Fed Chairman Jerome Powell signaled earlier that he is open to the idea of a cut.
EUR/USD edged up from 1.1311 to 1.1314 as of 14:42 GMT today. GBP/USD went up from 1.2686 to 1.2708. USD/JPY rallied from 108.43 to 108.68. USD/CHF climbed from 0.9897 to 0.9929.
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