As Thursday’s European session gets underway, the US dollar is holding on to the gains of the previous session. The greenback is trading almost flat as investors await the release later in the day of US CPI figures for October. A figure below 8% could allow the central bank to be less assertive and hike rates by 50 basis point in December, instead of the 75 already priced-in to the value of the greenback. Such a scenario would create scope for dollar weakness.
On the other hand, should October inflation come up above expectations, the dollar is likely to quickly claim back the losses of the previous week. In that scenario we can expect the index that measures the greenback’s performance versus a basket of other major currencies to return to levels above the 112 mark.
Ricardo Evangelista – Senior Analyst, ActivTrades
Disclaimer: opinions are personal to the authors and do not reflect the opinions of LeapRate. This is not a trading advice.
