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DXY IS TRADING SOFT AHEAD OF CPI DATA – BBH

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DXY is trading lower for the second straight day near 104.842. More Federal Reserve (Fed) officials are voicing concern about labor market weakness, but this week’s developments highlight the fact that weaker data in many of the major economies will feed into more dovish central banks, BBH macro strategists note.

CPI data is key in setting near-term Fed expectations

“The Dollar Index (DXY) is trading lower for the second straight day near 104.87 as markets await key inflation data. EUR/USD is trading higher near $1.0852, and GBP/USD is trading higher near $1.2875 after stronger than expected data and cautious BOE comments. USD/JPY is trading lower near 161.60.” 

“Recent softness in the U.S. data is challenging our view that the backdrop of persistent inflation and robust growth in the U.S. remains largely in place. Indeed, more Federal Reserve (Fed) officials are voicing concern about labor market weakness.” 


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