Dollar Index Analysis: Impact of Upcoming US CPI Data on DXY and Major Currency Pairs
Dollar Index and Upcoming CPI Data
The upcoming U.S. CPI data is crucial for understanding potential movements in the Dollar Index (DXY). Expectations of a 0.2% m/m increase and a 2.5% y/y rate could influence market dynamics. If inflation aligns with predictions, it might reinforce expectations of a dovish Federal Reserve, thereby weakening the USD.
Technical Analysis of the Dollar Index
- Current DXY trading price: $101.371, down 0.35%
- Immediate resistance at $101.778
- Key support found at $101.139
The DXY struggles to break the pivot point of $101.516, with potential for deeper declines if support levels are breached.
Impacts on GBP and Euro
Recent UK GDP data, showing stagnation at 0.0% m/m, combined with a goods trade balance deficit, may pressurize the GBP. The GBP/USD currently trades at $1.30945, with bullish momentum above $1.30606. Meanwhile, weak German CPI and Italian industrial production data could negatively affect the euro, already hinted by EUR/USD trading at $1.10405, showing a bullish outlook after pivot point support.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.