Published: 2024-07-26T13:05:23.000Z
USD flows: little impact from data
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Senior FX Strategist
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PCE prices marginally hgiher than expected but no impact seen. Focus shifts to next week's central bank meetings
There was nothing particularly notably in the US data, although the core PCE price index was slightly above expectations in June at 2.6% y/y. With only the final University of Michigan survey for July to come, it looks like a relatively quiet close to the week. The recovery in equities suggests a risk positive tone will be sustained for the day, possibly allowing some more corrective gains for the riskier currencies, but the focus will now shift to next week’s central bank meetings in the US, Japan and the UK, with a 10bp rate hike form the BoJ priced as a 70% chance, and a 25bp rate cut from the Bank of England seen as a 50-50 chance. We see no move from the BoJ and a cut rom the BoE, suggesting both the JPY and GBP will weaken in response.