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Inflation

British Pound resumes rally as retail sales jumpThe British pound has posted gains on Friday. In the European session, GBP/USD is trading at 1.3484, up 0.49% on the day. The pound has gained 1.5% this week and is trading at levels not seen since Feb. 2022. The markets were expecting a banner reading from April retail sales but the actual numbers crushed the forecast. Annual retail sales surged 5%, up from a downwardly revised 1.9% and above the market estimate of 4.5%. This marked the fastest pace of growth since Feb. 2022. Monthly, retail sales climbed 1.2%, up from a downwardly revised 0.3% in March and blowing past the market estimate of 0.2%. The surge was driven by sharp gains in food store sales and department stores, as favorable weather brought out consumers. The UK economy has been struggling and strong consumer spending has been a bright spot. Monthly retail sales have now increased for four straight months, which last occurred in 2020. The UK consumer spending more and is showing more optimism. The GfK consumer confidence index for May improved to -20 from -23 and beat the market estimate of -22. The improvement is likely a result of the de-escalation in global trade tensions as well as the Bank of England rate cut in early May. The impressive retail sales report, together with higher-than-expected inflation in April will raise expectations for the BoE to hold rates at its next meeting on June 18. There are no key US releases today but we'll hear from three FOMC members. There has been plenty of Fedspeak this week, with a message that the US tariffs will take a toll on the US economy, even with the temporary deal with China, and that the Fed favors a wait-and-see stance before further rate cuts. GBP/USD has broken above several resistance lines and is putting pressure in resistance at 1.3493. There is support at 1.3393 and 1.3367
by OANDA
Will Middle East Tensions Ignite a Global Oil Crisis?The global oil market faces significant turbulence amidst reports of potential Israeli military action against Iran's nuclear facilities. This looming threat has triggered a notable surge in oil prices, reflecting deep market anxieties. The primary concern stems from the potential for severe disruption to Iran's oil output, a critical component of global supply. More critically, an escalation risks Iranian retaliation, including a possible blockade of the Strait of Hormuz, a vital maritime chokepoint through which a substantial portion of the world's oil transits. Such an event would precipitate an unprecedented supply shock, echoing historical price spikes seen during past Middle Eastern crises. Iran currently produces around 3.2 million barrels per day and holds strategic importance beyond its direct volume. Its oil exports, primarily to China, serve as an economic lifeline, making any disruption profoundly impactful. A full-scale conflict would unleash a cascade of economic consequences: extreme oil price surges would fuel global inflation, potentially pushing economies into recession. While some spare capacity exists, a prolonged disruption or a Hormuz blockade would render it insufficient. Oil-importing nations, particularly vulnerable developing economies, would face severe economic strain, while major oil exporters, including Saudi Arabia, the US, and Russia, would see substantial financial gains. Beyond economics, a conflict would fundamentally destabilize the geopolitical landscape of the Middle East, unraveling diplomatic efforts and exacerbating regional tensions. Geostrategically, the focus would intensify on safeguarding critical maritime routes, highlighting the inherent vulnerabilities of global energy supply chains. Macroeconomically, central banks would confront the difficult task of managing inflation without stifling growth, leading to a surge in safe-haven assets. The current climate underscores the profound fragility of global energy markets, where geopolitical developments in a volatile region can have immediate and far-reaching global repercussions.
FX_IDC:USDWTILong
by UDIS_View
$JPIRYY -Japan's CPI (April/2025)ECONOMICS:JPIRYY 3.6% April/2025 source: Ministry of Internal Affairs & Communications - Japan's annual inflation rate stood at 3.6% in April 2025, unchanged from March while remaining at its lowest print since December. Food prices rose the least in four months (6.5% vs 7.4% in March) even as rice costs jumped 94.8% y-o-y, hitting a new record for the 7th straight month due to poor harvests and rising demand from record tourist numbers. Price growth also eased for clothing (2.7% vs 3.0%) and household items (4.1% vs 4.5%). Cost of education fell much steeper (-5.6% vs -1.2%). In contrast, inflation was stable for transport (at 2.7%) while accelerating for housing (1.0% vs 0.8%), healthcare (2.2% vs 2.0%), recreation (2.7% vs 2.0%), communications (1.1% vs 1.0%), and miscellaneous items (1.3% vs 1.1%). Prices of electricity (13.5% vs 8.7% ) and gas (4.4% vs 2.4%) rose the most in three months, as the impact of government subsidies faded. Core inflation climbed to an over 2-year high of 3.5% from 3.2% in March. Monthly, the CPI rose 0.1%, easing from a 0.3% gain in March.
ECONOMICS:JPIRYY
by Mr_J__fx
Pound steady as UK inflation surgesThe British pound posted gains earlier but has failed to consolidate. In the European session, GBP/USD is trading at 1.3395, up 0.03% on the day. The pound has gained 1.1% this week and earlier today rose as high as 1.3468, its highest level since Feb. 2022. UK inflation jumped to 3.5% y/y in April, up sharply from 2.6% in March and above the market estimate of 3.3%. This was the highest annual inflation rate since Jan. 2024 and was driven by higher prices for transport, housing and energy. Monthly, inflation soared to 1.2%, up from 0.3% and above the market estimate of 1.1%. The news wasn't much better from core CPI, which rose to 3.8% from 3.4% and was higher than the market estimate of 3.6%. This was the highest reading since April 2024. Monthly, the core rate jumped to 1.4%, up from 0.5% and above the market estimate of 1.2%. The rise in inflation can be partially attributed to the increase in the energy price cap and the Easter holidays, but is a disappointment for the government and for the Bank of England, as inflation had been trending lower. The BoE will be concerned by the rise in core inflation, which will complicate plans to further reduce rates. The BoE trimmed the cash rate by a quarter-point earlier this month by 0.25%, but rates are still higher than other major central banks, with the exception of the Federal Reserve. The Federal Reserve is taking a wait-and-see attitude before it lowers rates again, especially with the uncertainty swirling around US tariff policy. Atlanta Fed President Raphael Bostic said this week that even reduced tariffs would be "definitely economically significant" and said he favored one rate cut this year.
by OANDA
$GBIRYY - U.K Inflation Rate Accelerates (April/2025)ECONOMICS:GBIRYY April/2025 source: Office for National Statistics - The annual inflation rate in the UK jumped to 3.5% in April, the highest since January 2024, from 2.6% in March and above forecasts of 3.3%. The main upward pressure came from higher electricity and gas prices after the Ofgem price cap increase, while new Vehicle Excise Duty on electric cars lifted transport costs, and food inflation also picked up. Meanwhile, core inflation accelerated to 3.8%, the highest in a year.
ECONOMICS:GBIRYY
by Mr_J__fx
Canada's inflation eases, Canadian dollar edges lowerThe Canadian dollar continues to have a quiet week. In the North American session, USD/CAD is trading at 1.3920, down 0.21% on the day. Canada released the April inflation report, which indicated that headline and core inflation were moving in opposite directions. Headline CPI dropped sharply to 1.7% y/y, down from 2.3% but shy of the market estimate of 1.6%. This was the lowest annual inflation rate in seven months. The sharp drop was driven by the end of the consumer carbon tax, with gasoline prices dropping 18% lower compared to April 2024. Core inflation accelerated in April, with two key indicators rising to an average of 3.15%, compared to 2.85% in March. This was above the market estimate of 2.9%. The money markets have responded to the inflation data, lowering the probability of a rate cut at the June 4 meeting to 48%, down from 65% prior to the inflation release. The Bank of Canada has been aggressive in its easing cycle, trimming rates seven straight times from June 2024 until April, when it held rates. The cash rate is currently at 2.75% but the BoC is hesitant to lower in the midst of the uncertainty over the US trade tariffs, which have led to sharp swings in the stock markets. There are no US events on the calendar and the markets will be all ears as a host of FOMC members make public statements today. Investors will be looking for insights into the Fed's rate path. The Fed is widely expected to hold rates in June and may cut as little as twice in the second half of the year. That could change, depending on inflation, the US labor market and Trump's tariffs. USD/CAD is testing support at 1.3936. Below, there is support at 1.3911 There is resistance at 1.3952 and 1.3977
by OANDA
We are watching USDCAD today and on ThursdayCanadian CPIs and PPIs are coming out on Tuesday and Thursday respectively. Let's dig into the numbers. FX_IDC:USDCAD MARKETSCOM:USDCAD Let us know what you think in the comments below. Thank you. 77.3% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Past performance is not necessarily indicative of future results. The value of investments may fall as well as rise and the investor may not get back the amount initially invested. This content is not intended for nor applicable to residents of the UK. Cryptocurrency CFDs and spread bets are restricted in the UK for all retail clients.
by Marketscom
Euro jumps as Eurozone core CPI risesThe euro is sharply higher on Monday. In the North American session, EUR/USD is trading at 1.1250, up 0.79% on the day. Eurozone headline inflation was confirmed at 2.2% y/y and 0.6% m/m in April, unchanged from the preliminary estimates. The core rate was also confirmed at 2.7% y/y and 1% m/m. Services inflation rose to 3.9% from 3.5%. The European Central Bank will be pleased that inflation was unchanged in the final April release but remains concerned about services inflation, which remains persistently high. The ECB trimmed its key rate by a quarter point to 2.25% last month and meets next on June 5. The markets have priced in another rate cut, as the ECB looks to take advantage of stable inflation and lower rates in order to boost economic growth. The ECB can be expected to be cautious with its rate path and continue its data-driven approach. There is much uncertainty surrounding President Trump's tariffs, which has made it difficult for the ECB to make inflation and growth projections. What is clear is that eurozone growth has taken a hit from the tariffs and the outlook and the outllook for global growth has been revised downwards. The damage from the tariffs could be mitigated if the US and China can reach an agreement which removes the tariffs betweeen them. The uncertainty surrounding US trade policy has also pushed the Federal Reserve into a wait-and-see stance, despite Trump's loud calls for a rate cut. The Fed held rates at this month's meeting and is widely expected to stay on the sidelines again in June. The Fed is waiting for more clarity on the tariff front, but any surprises from inflation or employment data could have a signifcant impact on rate policy.
by OANDA
EUR/USD Daily Chart Analysis For Week of May 16, 2025Technical Analysis and Outlook: During the current trading session, the Eurodollar has exhibited notable signs of weakness, ultimately reaching a critical Outer Currency Dip at 1.111, facilitated by Mean Support at 1.119. Following this decline, the market experienced a pronounced rebound. Recent analysis indicates that the Euro will likely close with a retest of the completed Outer Currency Dip at 1.111, while it may progress towards the next Outer Currency Dip at 1.095. It is essential to highlight that upward "dead-cat" rebounds may arise within the current price range, particularly around the Mean Resistance level of 1.125, and could potentially approach an Inner Currency Rally at 1.129.
by TradeSelecter
DXY 1W Forecast until the end of MAY 2025Up-trend will resume and last until the end of February 2025 topping no higher than 114. Current bottom is in at 105.9 Hence, it shouldn't fall below. After February a consolidation period of 1,5 months will trap price action between the bottom of 122.16 and upper level of 114.9 The spring squeezed during consolidation will provide enough energy for further upwards movement starting in the end of April 2025. This will ignite a chain of devaluation of national currencies followed by epidemic inflation across the globe. This will finish/cool-down at DXY reaching the mark of 148. New reality after May 2025?
INDEX:DXY
by discarding
Slower Inflation Growth, Takes DXY lower.Overnight, the DXY traded lower, driven by 2 main factors. 1) The release of lower-than-expected CPI data at 2.3% 2) Rejection of the long-term bearish trendline and the area of confluence formed by the 61.8% and 38.2% Fibonacci retracement levels from the longer term. If the DXY breaks below the 38.2% Fibonacci retracement level of the shorter term, we could expect to see further downside, toward the target level of 100. This round-number level would align with the 61.8% Fibonacci retracement level and the short-term bullish trendline.
TVC:DXYShort
by JinDao_Tai
$USIRYY - U.S Inflation Rate Unexpectedly Slows (April/2025)ECONOMICS:USIRYY April/2025 source: U.S. Bureau of Labor Statistics - The annual inflation rate in the US eased to 2.3% in April, the lowest since February 2021, from 2.4% in March and below forecasts of 2.4%. Prices of gasoline fell at a faster pace and inflation also slowed for food and transportation. Compared to the previous month, the CPI rose 0.2%, rebounding from a 0.1% fall in March but below forecasts of 0.3%. Meanwhile, annual core inflation rate steadied at 2.8% as expected, holding at 2021-lows.
ECONOMICS:USIRYY
by Mr_J__fx
$EUIRYY -Europe CPI (April/2025)ECONOMICS:EUIRYY April/2025 source: EUROSTAT - Consumer price inflation in the Euro Area remained steady at 2.2% in April 2025, slightly exceeding market expectations of 2.1% and hovering just above the European Central Bank’s 2.0% target midpoint, according to a preliminary estimate. A sharper drop in energy prices (-3.5% vs. -1.0% in March) was offset by faster inflation in services (3.9% vs. 3.5%) and food, alcohol, and tobacco (3.0% vs. 2.9%). Prices for non-energy industrial goods rose by 0.6%, unchanged from March. Meanwhile, core inflation, which excludes food and energy, climbed to 2.7%, up from March’s three-year low of 2.4% and above the forecast of 2.5%. On a monthly basis, consumer prices increased by 0.6% in April, matching March’s rise.
ECONOMICS:EUIRYY
by Mr_J__fx
Euro breaks slide as eurozone core CPI climbs, US nonfarm payrolThe euro has posted gains on Friday. In the European session, EUR/USD is trading at 1.1325, up 0.37% on the day. Today's gains follow a three-day slide. US nonfarm payrolls came in at 177 thousand, much stronger than the market estimate of 130 thousand. Eurozone inflation for April was a surprise on the upside. Headline CPI remained steady at 2.2% y/y, edging above the market estimate of 2.1%. Lower energy prices were offset by a rise in service inflation and food prices. Monthly, CPI was also unchanged at 0.6%, above the forecast of 0.4%. Core CPI, which excludes food and energy and is a better gauge of inflation trends, jumped to 2.7% y/y, up from 2.4% in March and above the market estimate of 2.5%. This was the first acceleration in the core rate since May 2024. Services inflation, a key component in Core CPI remains hot and jumped to 3.9% from 3.5% in March. The rise in core CPI is a worrisome sign for the European Central Bank and could complicate plans to gradually lower interest rates. The ECB has been aggressive, cutting rates by 175 basis points in the current easing cycle. Still, more cuts are needed to boost the ailing eurozone economy. US nonfarm payrolls came in at 177 thousand in April, slightly below the downwardly revised gain of 185 thousand in March. This easily beat the market estimate of 130 thousand and is a sign that the US labor market remains in decent shape. Wage growth was unchanged at 3.8% y/y, just below the market estimate of 3.9%. Monthly, wage growth dropped to 0.2% from 0.3%, shy of the market estimate of 0.3%.
by OANDA
Macro Bullish Rates?An over simplification? I hope so. The narrative fits too close for me. Needless to say, it's worth keeping an eye on. If we manage to keep interest rates low for a while but inflation creeps in again (not due to high demand but because of monetary inflation) I can see the debt spiral scenario playing out in full force. This is a chilling thought, not something my generation has been exposed to and I believe it could have a very different impact to the population than the previous cycle. The difference being of course, the inflation not being demand driven but monetary debasement driven. To me this practically means a more impoverished population that is already struggling and those holding assets will further increase their portion of the pie. There are a lot of unknows for me, as I basically know nothing about this. These are just my back of napkin thoughts. Me, trying to make sense of the world we live in because I know you can't look to anyone for the answer. Why? Frankly, I have learned that 98% of us don't know anything. Ps - I am still not taking the deflationary narrative play off the table. Population decline, low interest rates and using robots to increase GDP etc. But either way all I can see is a exponential increase in debt creation. What other option is there? Both scenarios can't possibly lead to the same outcome, can they?
TVC:US10Y
by merchtank19
German inflation higher than expected, Euro dipsThe euro is calm on Wednesday. In the North American session, EUR/USD is trading at 1.1334, down 0.45% on the day. Germany's inflation rate dropped to 2.1% y/y in April, down from 2.2% in March but above the market estimate of 2.0%. This was the lowest level in seven months, largely driven by lower energy prices. The more significant story was that core CPI, which excludes energy and food and is a more reliable indicator of inflation trends, rose to 2.9% from 2.6%. This will be of concern to policymakers at the European Central Bank, as will the increase in services inflation. The ECB has to balance the new environment of US tariffs and counter-tariffs against the US, which will raise inflation, along with the strong rise in the euro and fiscal stimulus which will boost upward inflationary pressures. The ECB will be keeping a close look at Friday's eurozone inflation report, which is expected to follow the German numbers. Headline CPI is projected to drop to 2.1% from 2.2%, while the core rate is expected to rise to 2.5% from 2.4%. The central bank would prefer to continue delivering gradual rate cuts in order to boost anemic growth, but this will be contingent on inflation remaining contained. The markets were braced for soft US numbers but the data was worse than expected. ADP employment change declined to 62 thousand, down from a revised 147 thousand and below the market estimate of 115 thousand. This was followed by first-estimate GDP for Q1, which declined by 0.3% q/q, down sharply from 2.4% in Q4 and lower than the market estimate of 0.3%. This marked the first quarterly decline in the economy since Q1 2022. The weak GDP reading was driven by a surge in imports ahead of US tariffs taking effect and a drop in consumer spending. EUR/USD has pushed below support at 1.1362 and is testing support at 1.1338. Below, there is support at 1.1306 There is resistance at 1.1394 and 1.1418
by OANDA
German inflation higher than expected, Euro dipsThe euro is calm on Wednesday. In the North American session, EUR/USD is trading at 1.1334, down 0.45% on the day. Germany's inflation rate dropped to 2.1% y/y in April, down from 2.2% in March but above the market estimate of 2.0%. This was the lowest level in seven months, largely driven by lower energy prices. The more significant story was that core CPI, which excludes energy and food and is a more reliable indicator of inflation trends, rose to 2.9% from 2.6%. This will be of concern to policymakers at the European Central Bank, as will the increase in services inflation. The ECB has to balance the new environment of US tariffs and counter-tariffs against the US, which will raise inflation, along with the strong rise in the euro and fiscal stimulus which will boost upward inflationary pressures. The ECB will be keeping a close look at Friday's eurozone inflation report, which is expected to follow the German numbers. Headline CPI is projected to drop to 2.1% from 2.2%, while the core rate is expected to rise to 2.5% from 2.4%. The central bank would prefer to continue delivering gradual rate cuts in order to boost anemic growth, but this will be contingent on inflation remaining contained. The markets were braced for soft US numbers but the data was worse than expected. ADP employment change declined to 62 thousand, down from a revised 147 thousand and below the market estimate of 115 thousand. This was followed by first-estimate GDP for Q1, which declined by 0.3% q/q, down sharply from 2.4% in Q4 and lower than the market estimate of 0.3%. This marked the first quarterly decline in the economy since Q1 2022. The weak GDP reading was driven by a surge in imports ahead of US tariffs taking effect and a drop in consumer spending.
by OANDA
Australian core CPI falls within the RBA target, Aussie shrugsThe Australian dollar has been showing strong movement this week but is calm on Wednesday. In the European session, AUD/USD is trading at 0.6391, up 0.14% on the day. Australia released the CPI report for the first quarter. The Australian dollar didn't show much reaction, but the data could point to another rate cut from the Reserve Bank of Australia. Headline CPI remained unchanged at 2.4% y/y, just above the market estimate of 2.3%. The significant news was that RBA Trimmed Mean CPI, the key core inflation indicator, dropped to 2.9% y/y from a revised 3.3% gain in Q4 2024. This is the first time in three years that core CPI is back within the RBA's target band of between 1-3%. The drop in core inflation is good news for the government, with the national election on Saturday. Australian Treasurer Jim Chalmers jumped on the news, stating that the market expects four or five rate additional rate cuts this year, which would save households with mortgages "hundreds of dollars". The Reserve Bank is expected to lower rates at its next meeting on May 20, which would mark only the second rate cut this year. After cutting rates in February, the central bank has stayed on the sidelines as US President Trump's tariffs have escalated trade tensions and sent the financial markets on a roller-coaster ride. In the US, the markets are bracing for some weak data later today. ADP employment is expected to slip to 108 thousand, compared to 155 thousand in the previous release. ADP is not considered a reliable gauge for Friday's nonfarm payrolls, but a weak reading will only increase the anxiety of the nervous markets. US first-estimate GDP for Q1 is expected to slide to just 0.4% q/q, after a 2.4% gain in Q3. If there is a surprise reading from GDP, we could see a strong reaction from the US dollar after the release. AUD/USD is testing resistance at 0.6403. Above, there is resistance at 0.6431 0.6357 and 0.6329 are the next support levels
by OANDA
Navigating Trump Tariffs on the Dow JonesNavigating the movements of the **US30 (Dow Jones Industrial Average)** can be challenging, especially amid shifting economic policies. The Dow, which tracks 30 major U.S. companies, is highly sensitive to trade policies, corporate earnings, and geopolitical risks. Trump’s plan to impose **10% across-the-board tariffs** and **60%+ tariffs on Chinese goods** has sparked concerns about inflation, supply chain disruptions, and retaliatory trade measures. Investors are closely watching how these policies could impact multinational companies within the index, particularly those reliant on global trade, such as **Boeing, Apple, and Caterpillar**. For everyday Americans, higher tariffs could mean **rising prices on imported goods**, from electronics to household items, worsening inflation. While tariffs aim to protect domestic industries, they often lead to **higher production costs** for businesses that rely on foreign materials, potentially triggering job cuts or reduced consumer spending. The stock market’s reaction—volatility in the US30—reflects these uncertainties, as investors weigh the risks of slower growth against potential benefits for U.S. manufacturers. Traders navigating the US30 must monitor **Fed policy, corporate earnings, and trade war developments**. If tariffs escalate, defensive stocks (utilities, healthcare) may outperform, while industrials and tech could face pressure. Long-term investors might see dips as buying opportunities, but short-term traders should prepare for turbulence. Ultimately, Trump’s tariff policies could reshape market dynamics, making adaptability key for those trading the Dow.
FUSIONMARKETS:US30Education
by KeN-WeNzEl
Yen extends gains, BOJ Core CPI lower than expectedThe Japanese yen has rallied for a third straight day. In the European session, USD/JPY is trading at 140.38, down 0.33% on the day. The yen has climbed 1.3% since Thursday, as the US dollar is under pressure against the major currencies. BoJ Core CPI, a key inflation indicator, remained at 2.2% for a third consecutive month in March, shy of the forecast of 2.4%. This follows Japan's National Core CPI, which rose 3.2% y/y, matching expectations but higher than the 3.0% gain in February. National CPI eased to 3.6%, down from 3.7% in February and below the market estimate of 3.7%. The inflation data comes a week before the BoJ's policy meeting next week. The central bank has signaled that it will continue to raise interest rates as wages and inflation have been rising. However, the risks to inflation and growth from US tariffs have muddied the rate outlook and the BoJ may decide to push off another hike until later in the year. The finance ministers of Japan and the US will meet later this week, as Tokyo looks to carve out some tariff exemptions. The BoJ is likely to sit tight and see if the talks lead to a breakthrough. The US is expected to bring up the exchange rate, as President Trump has accused Japan of deliberately keeping the yen weak in order to protect its export sector. There are no key releases out of the US today, but we'll hear from three FOMC members later today. The markets have priced in a rate cut in May at 10%, with a 62% probability of a rate cut in June.
by OANDA
Interest Rates don't seem to want to slow downWe believed that interest rates were going higher in Early April/Late March. The Bullish Engulfing formation was a sign that higher interest rates were coming TVC:TNX The 10 Yr Yield Downtrend was broken, it retraced some, we posted that it was likely consolidating, & seems to want to go a little higher. Central Banks worldwide are lowering rates while the US is raising them. --- Please see our profile for more info... We do post a lot.
TVC:US10Y
by ROYAL_OAK_INC