EUR/USD

The EUR/USD pair shows ambiguous trading dynamics, holding near 1.0925. The day before, trading activity temporarily increased with the publication of macroeconomic statistics on inflation in the EU and the US, but by the close of the day session the instrument returned to zero again. Data from Germany turned out to be neutral: in February, the Consumer Price Index added 2.5% in annual terms and 0.4% in monthly terms. The Harmonized CPI added 0.6% month-on-month and 2.7% year-on-year, which also coincided with forecasts and data for the previous period. In turn, in the United States, Core CPI excluding Food and Energy remained at the same level of 0.4% in February, while analysts expected 0.3%, and in annual terms the figure adjusted from 3.9% to 3.8% with expectations at 3.7%. The Consumer Price Index accelerated from 0.3% to 0.4% on a monthly basis and from 3.1% to 3.2% on an annual basis. More persistent inflation may prevent the US Federal Reserve from fully implementing plans to reduce borrowing costs this year. However, the market is still counting on at least three adjustments to the rate, the first of which could take place in June. The focus of investors' attention today is the January statistics on the dynamics of Industrial Production in the eurozone. A sharp contraction in dynamics is expected by 1.5% after an increase of 2.6% in the previous month, and in annual terms production may decline by 2.9% after an increase of 1.2% in December 2023.

GBP/USD

The GBP/USD pair is trading with a slight decline, consolidating near 1.2790. The day before, the pound showed quite active "bearish" dynamics, but closer to the close of the day's session, the "bulls" managed to regain most of the lost positions. At the same time, there were no noticeable reasons for the growth of the British currency on Tuesday. Data on the UK labor market turned out to be mixed: Claimant Count Change in February added 16.8 thousand after an increase of 3.1 thousand in the previous month, while analysts expected 20.3 thousand, and Employment Change in January decreased by 21.0 thousand after an increase of 72.0 thousand in December 2023. The Unemployment Rate in January adjusted from 3.8% to 3.9%, while Average Earnings Including Bonus slowed down from 5.8% to 5.6%, with market expectations of 5.7%, and excluding bonus from 6.2% to 6.1%, while experts did not expect changes. With the opening of the American session, the dollar managed to regain some of its positions amid the publication of inflation data, which increased doubts about the possibility of launching a program to reduce borrowing costs by the US Federal Reserve in June. The Consumer Price Index in February accelerated from 0.3% to 0.4% in monthly terms and from 3.1% to 3.2% in annual terms, and the Core CPI excluding Food and Energy in monthly terms remained at 0. 4% with forecasts of 0.3%. The focus of investors today is the January statistics on Industrial Production in the UK, which reflected a decrease in the indicator from 0.6% to -0.2% month-on-month and from 0.6% to 0.5% year-on-year, while the Manufacturing Production, one of the main indicators reflecting the state of the sector, fell from 0.8% to 0.0% month-on-month and from 2.3% to 2.0% year-on-year. Against this background, the trade balance deficit increased from 13.99 billion pounds to 14.52 billion pounds, although analysts had expected a value of -14.90 billion pounds.

AUD/USD

The AUD/USD pair is showing weak growth, trying to correct after a predominantly "bearish" start to trading this week: quotes are testing 0.6610 for a breakout, receiving support from technical factors. In addition, investors positively assessed macroeconomic publications the day before: the National Australia Bank Business Conditions index rose from 7.0 points to 10.0 points in February, ahead of neutral forecasts, and the Business Confidence indicator slowed down from 1.0 points to 0.0 points. In turn, the American currency on Tuesday received support from inflation statistics, which may signal in favor of continuing the wait-and-see policy of the US Federal Reserve. Core Consumer Price Index excluding Food and Energy added 0.4% monthly and 3.8% annually, which turned out to be slightly higher than expectations at the levels of 0.3% and 3.7%, respectively. The CPI accelerated from 3.1% to 3.2% on an annual basis and from 0.3% to 0.4% on a monthly basis. Tomorrow at 14:30 (GMT 2) February statistics on the Producer Price Index will be presented in the United States: it is expected that on a monthly basis the indicator will consolidate at around 0.3%, and on an annual basis it may increase from 0.9% to 1.2%, while the Core PPI annual rate will remain at 2.0%, and the monthly rate will drop from 0.5% to 0.2%. In turn, Retail Sales could adjust from -0.8% to 0.8%, while the indicator excluding autos will rise from -0.6% to 0.5%.

USD/JPY

USD/JPY shows mixed dynamics, consolidating near 147.60. The day before, the instrument showed quite active growth, which was associated with the publication of statistics on consumer inflation in the United States, which turned out to be higher than market expectations. The Core Consumer Price Index in February added 0.4% in monthly terms and 3.8% in annual terms, which was higher than the forecasts of 0.3% and 3.7%, respectively, and the main indicator accelerated from 3.1% to 3.2%. Analysts took these data as a signal for a possible continuation of the US Federal Reserve's wait-and-see policy regarding a possible reduction in borrowing costs this year. At the same time, as before, investors expect at least three adjustments to the rate by the end of 2024, if the price situation remains within the forecasts. In turn, the yen is receiving support amid expectations of a possible abandonment of the Bank of Japan's policy of negative interest rates. Some analysts admit that the regulator may resort to such a step as early as April, awaiting additional comments from officials at a meeting next week. At the same time, the Governor of the Bank of Japan, Kazuo Ueda, noted the day before that the Japanese economy is showing signs of recovery, although significant risks are still present. However, household spending is improving moderately on hopes of higher wages in the future, so the regulator is likely to raise interest rates by 20 basis points to 0.10%. Japan's producer inflation data supported the yen, with the Producer Price Index accelerating 0.2% in February from flat the previous month, while analysts had expected 0.1%, and the PPI YoY rising from 0.2% to 0.6%, also ahead of forecasts of 0.5%.

XAU/USD

The XAU/USD pair is holding near 2160.00, awaiting the emergence of new drivers on the market. The day before, the instrument showed an active decline, which was the reaction of investors to the publication of key macroeconomic statistics on inflation in the United States. In February, the Consumer Price Index adjusted from 3.1% to 3.2% in annual terms, while analysts expected neutral dynamics, and in monthly terms the indicator accelerated from 0.3% to 0.4%. Core CPI excluding Food and Energy, added 0.4% month-on-month and 3.8% year-on-year, which turned out to be higher than expert estimates of 0.3% and 3.7%, respectively. More sustained price pressure may cause another revision of forecasts regarding the rate of possible reduction in the cost of borrowing by the US Federal Reserve this year. Markets are now pricing in at least three 25 basis point interest rate adjustments, the first of which could come in June. Tomorrow at 14:30 (GMT 2) February statistics on producer prices will be published in the United States, and at the end of the week data on consumer inflation in Italy and France will be presented. In addition, in the US the market will receive data on Industrial Production and the Consumer Confidence index from the University of Michigan.