Marketwatch North America

Daily Insights
March 12, 2024

U.S. February Consumer Prices were higher than forecast in all categories and higher than January CPI except for Y/Y Core (ex. food & energy) which dropped to 3.8% from 3.9%. Even excluding volatile gasoline prices, M/M CPI was +0.4% vs. the +0.3% estimate. Not a great result for Fed Chairman Powell and his team at the FOMC who have been patiently waiting for the current 5.50% target overnight rate to work its magic to bring inflation closer to the Fed’s 2% long term goal.

Real Average Hourly Earnings showed increasing wages (thankfully to most), helping to offset higher inflation. Annual hourly earnings were +1.1% and M/M weekly earnings were +0.5%.

Annual CPI was reported at a 3.2% annual rate (3.1% est.). And this excludes effects of ‘shrinkflation’ (shrinking the quantity or size of a service or product while leaving prices unchanged), so inflation is higher than is being reported.

The dollar is higher vs. all major pairs in trading today. Key dollar gains: +0.60% vs. JPY, +0.40% vs, GBP, +0.36% vs. NZD, +0.20% vs. AUD, +0.16% vs. MXN, +0.13% vs. CAD and +0.10% vs. EUR. The dollar index is +0.16% at 103.035.

U.S. Treasury yields are higher following the CPI data with uniform gains across the 1yr-30yr tenors. The 10-year yield is +0.047% trading at 4.145% (closed yesterday 4.099%).

Next key data on the economic calendar is Thursday’s M/M Retail Sales (estimated +0.8% vs. the previous -0.8%, really?), along with February PPI (inflation at the producer level).

Economic Calendar

USD - Core CPI m/m
AUD - NAB Business Confidence
USD - CPI m/m
USD - CPI y/y
GBP - CB Leading Index m/m
GBP - BOE Gov Bailey Speaks
EUR - German Final CPI m/m
GBP - Claimant Count Change
GBP - Average Earnings Index 3m/y
GBP - Unemployment Rate
USD - 10-y Bond Auction
USD - Federal Budget Balance
NZD - FPI m/m
EUR - ECOFIN Meetings
USD - NFIB Small Business Index
GBP - MPC Member Mann Speaks

Market Indicators

Currency Pairs
Pair High Low
usd/jpy 148.178 146.617
eur/usd 1.09438 1.09017
gbp/usd 1.28234 1.27321
aud/usd 0.66388 0.65856
usd/cad 1.35116 1.34664
eur/gbp 0.85511 0.85256
usd/mxn 16.8507 16.7708
Equities and Commodities
S&P 500 5135.72
NASDAQ 18036
DOW 38783.1
GOLD 2161.29
SILVER 24.16

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.