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    What is in today’s US data bag?

    Three things deserve particular attention but are unlikely to make markets see higher probability of rate hikes by Fed in near future.

    CPI was down from 1.1 to 1% YoY while it was expected to maintain the previous level, but on the other hand the core measure went up by a notch, to 2.2% YoY as was expected. And there is high correlationo f CPI core and the PCE core - the Fed’s inflation indicator of choice.

    link do pliku

     Source: Macrobond, XTB

    The key to the Fed perception of the economy now may however be the labour market rather than the monthly CPI. THere was an item in today’s bag of data telling something more about the labour market: initial jobless claims. It stopped trying to set a new all-time minimum, like it did in the last week of April. The further evidence of a loss of downward trend in initial jobless claims should be considered a negative news confirming that there are some broader changes on the labour market (so the dramatically low NFP may be more than just a one-off).

    link do pliku

      Source: Macrobond, XTB

     Finally, we also had the Philly Fed. This is the second regional index beating the expectations and gaining MoM after NY Empire manufacturing. So the braodly represented in regional indices drop in sentiment in May is most likely now being reversed, but this is now just a background to what happens on the labour market.

    link do pliku

    Source: Macrobond, XTB

    Such a mixed bag will likely make Fed even more happy to wait for the June NFP, no reason for shifts of views towards the July meeting for now. 

     The data was unlikely the trigger for the dollar to go back to the pre-NFP levels on EURUSD. This is more a risk-off reaction, given that the US stocks are also enduring sharp losses

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