| Time | Country | Event | Period | Previous value | Forecast | Actual |
|---|
| 00:30 | Australia | CPI, y/y | November | 4.9% | 4.4% | 4.3% |
| 07:45 | France | Industrial Production, m/m | November | -0.3% | 0.1% | 0.5% |
During today's Asian trading, the US dollar consolidated against major currencies as investors took a wait-and-see attitude ahead of the release of US inflation data, which could change the outlook for Fed monetary easing.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) fell by 0.01% to 102.56. Since the beginning of the month, the index has increased by 1.15% after falling by 2% in December, as traders reassess how steep and early the rate cuts from the Fed are likely to be. According to the CME FedWatch Tool, markets see a 62.7% probability of a 25 basis point rate cut at the Fed meeting in March 2024 and a 94.0% probability of a rate cut in May 2024, with almost 140 basis points of cuts priced in for this year. However, the situation may change after tomorrow's publication of the CPI report. Economists forecast a slight recovery in the overall CPI - to 3.2% year-on-year from 3.1% in November, as well as a further slowdown in the core CPI - to 3.8% from 4.0%. If the data confirms that inflation continues to decline, this may strengthen expectations of a rate cut in March.
The Australian dollar rose 0.3% against the US dollar, helped by increased risk appetite among investors. Meanwhile, market participants almost ignored Australia's inflation data, which reinforced expectations that interest rates would not need to rise any further. The Australian Bureau of Statistics (ABS) said that consumer price growth slowed to 4.3% per annum in November (the lowest value since January 2022) from 4.9% per annum in October. Economists expected the CPI to grow by 4.4% per annum. Meanwhile, excluding volatile items and holiday travel, underlying inflation moderated to 4.8% per annum from 5.1% per annum in October. The rate hit the lowest since March 2022. A closely watched measure of core inflation, the trimmed mean, rose by 4.6% per annum compared to +5.3% per annum in October.