Forex Today – 14/03: Markets Await US PPI

Markets await the release of US PPI data as an indicator of US inflation, which ticked up last week from 3.1% to 3.2%.

1. There will be a release later today of US PPI (purchasing power index) data, which is typically taken as a clue regarding inflation. Headline PPI is expected to have grown by 0.3% month-on-month. If the figure is higher, that will likely be bullish for the US Dollar and bearish for US stock markets; vice versa if lower. Treasury Secretary Janet Yellen yesterday warned the decline in inflation may not be smooth.
2. Bitcoin advanced again yesterday to make a new all-time high at $73,679, boosted by strong net inflows to ETFs. The short-term price action looks bullish. Trend traders will be interested here on the long side.
3. In the Forex market, the New Zealand Dollar has been the strongest major currency since the Tokyo open today. The Japanese Yen has been the weakest.
4. In the commodities market, Cocoa futures rose very strongly yesterday to reach new multi-year highs. Trend traders will be keen to be involved in this very long-running trend on the long side.
5. UK GDP data released yesterday showed a month-on-month increase of 0.2%, as expected.
6. Analysts in Japan are expecting sizable corporate wage rises will be agreed this week, which will likely trigger an abandonment by the Bank of Japan of its current ultra-loose monetary policy as soon as next week.
7. There will be releases of US Retail Sales and Unemployment Claims data today at 12:30pm London time.