US PPI inflation depreciated the Dollar Index (DXY) by 0.5% to 102.62. At the time of writing, DXY is trading at 102.47, DBS FX analyst Philip Wee notes.
PPI inflation flat at 0% MoM in July
“A lower-than-expected US PPI inflation depreciated the Dollar Index (DXY) by 0.5% to 102.62, near the 102.69 close on August 5. PPI inflation increased by 0.1% MoM in July vs. the consensus for it to stay unchanged at June’s 0.2%.”
“Excluding food and energy prices, core PPI inflation was flat at 0% MoM in July, less than the 0.2% consensus, while June was revised to 0.3% from 0.4%. The US Treasury 2Y yield fell a second session by 8.8 bps to 3.93%, while the 10Y yield declined less by 6.1 bps to 3.84%.”
“The futures market priced in a 159% chance of the Fed lowering interest rates by 50 bps to 4.75-5.00% at its FOMC meeting on September 18.”
Source: https://www.fxstreet.com/news/dxy-falls-under-the-weight-of-ppi-inflation-dbs-202408141035