To add to that, the FED Chairman, Janet Yellen has cited concerns about falling behind schedule in hiking rates soon enough to prevent inflation from picking up faster than anticipated so they won’t have to hike rates at a faster pace that could cause problems for the economy(Choke Growth). Traders and Investors viewed this comment as a hawkish comment, causing the greenback to strengthen throughout trading yesterday.
We will be expecting the CPI data today at 2.30PM Nigerian time. All eyes will be on this data as a faster inflation rate could see the push forward the timetable for the Federal fund rate hike.
Going to the UK Economy, Inflation though growing strongly fell below expectation by 0.1% to come out at 1.8%, this is just 0.2% lower than the target range of the BOEs’ Inflation target. The Pound fell 1% against the greenback to close below the 1.2500 key support area. Going into today, We will be looking out for UK Employment data, We are already seeing a spill through- effect of Brexit into employment, the employment sub-index for PMI service came out at a 5 month low although that of Manufacturing and Construction came out around post-brexit highs nevertheless we think this may affect todays’ data. Article 50 is slated to be triggered on March 31st, based on this many Organisations are maintaining a wait and see mode to get clarity in the new regimes polices before taking up more labour.
Furthermore, the CANADIAN Manufacturing Sales report for December will follow at 2.30PM Nigerian time, we expect a spill over effect from the Christmas celebrations to filter into the outcome of today’s data.
Finally, the Crude-Oil inventories data will be wrapping up the day at 4.00PM today. We have been getting huge increase in US Oil stock piles with last week coming in at 13.8M, this could mean that the US expect higher oil prices therefore the increase in stock piles to mitigate against rise in prices filtering immediately into production cost.