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Forex Today: The possibility of a US rate cut in March drops to 65%

Forex Today: The possibility of a US rate cut in March drops to 65%

The US dollar index hit a new one-month high yesterday as the market begins to see less chance of the Fed making a rate cut at its March meeting.

➡️ Over the past day, the US dollar index advanced strongly to reach a new 1-month high again after a period of consolidation. The dollar is reaching the same medium-term highs in currency pairs AUD/USD  And  NZD/USD  , as well as in the couple  EUR/USD  , which has now seen the end of its long-term uptrend. This rise in the dollar is accompanied by a rise in US Treasury yields as market participants reassess the possibility of a Fed rate hike in MarchThe CME FedWatch instrument fell from the 80% forecast for this cut last Friday to the current 65%. This belief was reinforced by recent comments from FOMC member Waller who said, “I see no reason to act as quickly or as quickly as we have in the past” regarding potential rate cuts.

➡️ Most stock markets have moved lower over the past day, especially in Asia, driven lower by poor Chinese GDP and retail sales data released a few hours ago.

➡️ In the Forex market, the US dollar has been the strongest major currency since Tokyo opened today. The Australian dollar and Japanese yen were the weakest, focusing on the AUD/USD currency pairs and  USD/JPY  .

➡️ They  it fell pretty hard on the last day, and is near a bearish breakdown below the $2000 area, which tends to act as support.

➡️ UK CPI (inflation) data was released today showing that instead of falling from 3.9% to 3.8% as expected, annualized inflation rose to 4.0%.

➡️ Canadian Consumer Price Index (inflation) data released yesterday showed a monthly contraction of 0.3%, as widely expected.

➡️ Cocoa futures last Friday  have reached a new multi-year high price, which will keep trend traders interested in this commodity on the long side. It has been showing a powerful bullish trend for more than a year now.

➡️ The following potentially impactful economic data will be released today:

    • US retail sales
    • Australian unemployment

 

Credit by DailyForex.com

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