Daily Forex Market Preview, 14/02/2018
The U.S. dollar was seen falling against its peers on Tuesday amid a lack of any clear market catalysts. In the UK, data showed that consumer prices edged higher once again in January. Headline CPI was seen rising 3.0% on an annual basis while core CPI was also seen higher at 2.7%.
In Japan, the quarterly GDP data showed that the economy advanced only 0.1% on the quarter, missing estimates of a 0.2% increase. The previous quarter’s GDP was however revised higher to 0.6%.
Earlier in the day, New Zealand’s inflation expectations showed that inflation expectations were seen at 1.86% in one year and 2.1% in two years. The data gave a short term bump to the Kiwi dollar. The RBNZ had previously expected inflation to reach 2% band only around 2019. Looking ahead, the Eurozone quarterly GDP data will be coming out.
No changes are expected as the GDP is expected to remain steady at 0.6%. In the U.S. session, inflation data is expected to show a 0.3% increase on the month while core CPI is forecast to rise 0.2%. Retail sales figures will also be coming out at the same time.
GBPUSD intra-day analysis
GBPUSD (1.3906): The British pound continues to trade with last Friday’s range with price advancing to the upside. A breakout from Friday’s range could determine the near term bias in the GBPUSD. The British pound gained momentum as the inflation data showed consumer prices edging back to the 3% threshold. This sparked speculation of a faster than expected rate hike from the BoE as previously communicated by the central bank. On the 4-hour time frame, GBPUSD has close above the 1.3855 level of support which has failed to act as resistance. We expect GBPUSD to move sideways with the 1.4037 – 1.3855 range in the near term.