Core PCE inflation to test bets of two Fed rate cuts in 2024. Yen awaits BoJ Summary of Opinions, Tokyo CPI. Canadian CPI data also enters the spotlight. Will PCE data confirm Fed rate cut bets? The weaker-than-expected retail sales numbers this week corroborated that view. Indeed, according to Fed funds futures, investors are penciling in around 50bps worth of reductions by the end of the year, assigning around a 70% probability for the first cut to be delivered in September.
What’s more, Governor Ueda said that he is not ruling out interest rates rising in July. Still, the yen fell, perhaps as some market participants were expecting more concrete signals about a July hike and a potential slowdown in bond purchases. This is also evident by market pricing, where the probability of a 10bps hike in July has dropped significantly, to around 27%. Ahead of the decision that chance was more than 65%.
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Source: FXStreetNews - 🏆 14. / 72 Read more »
Source: FXStreetNews - 🏆 14. / 72 Read more »