News & Analysis

US CPI keeps markets volatile following the central bank bonanza

Nov 13, 2021

US CPI keeps markets volatile following the central bank bonanza

FX market price action was broadly driven by inflation concerns yet again this week, with the release of October’s US CPI providing the catalyst for renewed volatility. Beyond that, the data calendar has been relatively light, pushing the emphasis of additional drivers into the political space. Rising tensions between the US and Russia kept RUB traders on their toes towards the end of the week, while a Times article pertaining to ministers de-escalating tensions with the EU over Northern Ireland prompted a relief rally in the pound. Next week, CPI remains top of mind as a number of nations are set to release reports highlighting above target price growth, however, we believe these releases will have less of an impact on broader markets relative to the US release this week. Additionally, central banks from South Africa and Turkey are expected to deliver fresh rate decisions, while meeting minutes from the Reserve Bank of Australia are also set for distribution.

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Authors: 
Simon Harvey, Senior FX Market Analyst
Ima Sammani, FX Market Analyst

 

 

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