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26 Feb 2015
Consensus expectations for a decline in US CPI could be USD negative – KBC
FXStreet (Barcelona) - The KBC Bank Research Team shares the probable reactions in EUR/USD and USD/JPY if US CPI falls into negative territory, and matches consensus expectations.
Key Quotes
“In the US, the calendar is very interesting too with the durable orders, the CPI and the jobless claims. Durable orders were very weak over the previous months. Another mediocre figure could raise doubts on the pace of the US recovery.”
“We also see downside risks for (core) US CPI. If this scenario comes true, it could be USD negative, especially as the Fed keeps a close eye on inflation.”
“EUR/USD was basically captured in a very tight sideways range of late. A limited uptick is possible in case of USD negative data but we don’t expect a big leap higher of the single currency ahead of the start of ECB QE in March.”
“USD/JPY held op reasonably well of rate. This cross rate might be a bit more vulnerable in case of USD negative news.”
Key Quotes
“In the US, the calendar is very interesting too with the durable orders, the CPI and the jobless claims. Durable orders were very weak over the previous months. Another mediocre figure could raise doubts on the pace of the US recovery.”
“We also see downside risks for (core) US CPI. If this scenario comes true, it could be USD negative, especially as the Fed keeps a close eye on inflation.”
“EUR/USD was basically captured in a very tight sideways range of late. A limited uptick is possible in case of USD negative data but we don’t expect a big leap higher of the single currency ahead of the start of ECB QE in March.”
“USD/JPY held op reasonably well of rate. This cross rate might be a bit more vulnerable in case of USD negative news.”