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Hello everyone, today Avatrade Aihua Foreign Exchange will bring you "[Aihua Foreign Exchange]: CPI optimism fades and Trump's tariffs are ringing!". Hope it will be helpful to you! The original content is as follows:
After the improvement of market sentiment on Wednesday, investors took a cautious stance on Thursday morning. The European Statistics Office will release industrial production data for January, and the U.S. economic calendar will release weekly initial jobless claims and February producer price index (PPI) data later that day.
Reflecting the risk-averse market atmosphere, U.S. stock index futures fell 0.2% to 0.7% for the last time that day. Meanwhile, the U.S. dollar index stabilized above 103.50 after ending a seven-day decline on Wednesday. The U.S. Bureau of Labor Statistics mid-week report said that the U.S. annual inflation fell from 3% in January to 2.8% in February, as measured by changes in the Consumer Price Index (CPI). On a monthly basis, the core CPI (excluding food and energy prices that are volatile) rose 0.2%.
The Bank of Canada (BoC) announced on Wednesday that it had lowered policy interest rates by 25 basis points to 2.75%, as expected. "Intensified trade tensions and U.S. tariffs could increase inflationary pressures in Canada and curb growth," the Bank of Canada pointed out in its policy statement. The U.S. dollar/Canada maintained a slight increase on the day after falling nearly 0.5% on Wednesday, around 1.4400.
Basic foreign exchange market conditions:
Euro/USD corrected on Wednesday and fell by about 0.3%. The pair struggled to accumulate bullish momentum and traded below 1.0900 in early trading on Thursday.
The GBP/USD failed to make a decisive move in either direction, with little change at the close of Wednesday. The pair continued to consolidate sideways around 1.2950 earlier Thursday.
Australian data showed earlier Thursday that consumer inflation expectations in March were from 4.6% dropped to 3.6%. After a slight increase on Wednesday, the AUD/USD fell slightly and fluctuated around 0.6300, beginning the European session.
After a two-day rebound, the US dollar/JPY turned down in the early trading on Thursday, trading https://avatradescn.com below 148.00. Bank of Japan's (BoJ) Governor Kazuo Ueda said on Thursday that Japan's basic inflation rate "still be slightly below 2%.
Bulle market fundamentals:
Gold traded above $2,930 in the early trading of Europe.
Analysis of major currency trends:
Euro: The intraday bias of GBP/USD is still on an upward trend. Continuous trading above the 61.8% retracement level of 1.2923 from 1.3433 to 1.2099 will resume gains from 1.2099 and pave the way for a decline to the 1.3433 high. Nevertheless, breaking through the 1.2860 support should indicate a short-term peak and lead to a deeper pullback.
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