CPI exceeds expectations, stocks and dollar mixed
March’s US CPI rose 0.6% over the previous month - its fastest pace since 2012. After an initial sell-off in stocks and bonds, the market is little changed. Traders are focused on earlier news that health officials called for an immediate halt in J&J’s single dose vaccine after several cases of blood clots were reported. OPEC predicts that global oil markets will recover, supporting its recent decision to increase production. The Treasury plans to sell 30-year bonds after decent demand for yesterday’s 3 and 10-year note auctions. The US Treasury 10Yr trades at 1.66%, gold up by $15 to $1747 per oz, and oil up slightly to $60.21 per barrel.
“As I get older, I get smaller. I see other parts of the world I didn’t see before. Other points of view. I see outside myself more.”
April 13, 2021
EUR/USD 1.1935 GBP/USD 1.3749 USD/CAD 1.2566 AUD/USD 0.7627 USD/JPY 109.25 USD/CNH 6.5449 USD/ILS 3.2907 USD/MXN 20.1056 USD/CHF 0.9223 USD/INR 75.0550 USD/BRL 5.7127 USD/SGD 1.3409 USD/DKK 6.2319 USD/SEK 8.5412 USD/NOK 8.5004
The US dollar is lower, erasing earlier gains, following release of March’s CPI data. The various CPI measurements were all better than expected by 0.1%. CPI MoM of 0.6% was the fastest pace since 2012. Traders await Q1 earnings reports from the major US banks.GBP
The UK pound is slightly lower erasing earlier gains which were based on upbeat GDP, Industrial and Manufacturing data in the UK for February. Some selling of the pound was seen after the Bank of England announced that its chief economist, Andrew Haldane, resigned.EUR
The euro edged higher overnight, reaching its highest level in two weeks. Traders are watching a developing political showdown in Germany to determine who will succeed German Chancellor Angela Merkel in September.CAD
The Canadian dollar dropped by nearly 0.25%, as traders reacted to news of the Johnson & Johnson vaccine and US CPI. The next key economic data for Canada will be Thursday’s Manufacturing Sales and Existing Home Sales.ASIA/PACIFIC
The Chinese yuan moved little overnight following news that US Treasury Secretary Janet Yellen has decided not to name China as a “currency manipulator” as will be reported in a semiannual US FX report later in the month.
For more analysis on FX markets or information regarding SVB's FX services:
See all of SVB's latest FX information and commentary at www.svb.com/trends-insights/foreign-exchange-advisory