Markets are less sensitive to inflation news – ING

US initial jobless claims were lower than expected again on Thursday, but continuous claims rebounded to 1.834 million. Durable goods orders were stronger than expected and the expected lower revision in second quarter GDP from 3.0% to 2.9% did not materialize. August PCE data will be released on Friday, notes ING FX analyst Francesco Pesole.

DXY to trade in the 100.0-101.0 range in the short term

“Market prices for year-end Fed rates have risen by a few basis points over the past two sessions, but the greenback was on offer again yesterday after an adjustment in positioning on Wednesday. However, markets continue to consider a 50bp cut at one of the next two meetings.”

“Today, the August PCE data will be released. We expect a 0.2% month-on-month core print, in line with consensus, and limited market impact. Even with a small deviation from consensus, the Fed’s recent shift in focus to the employment side of its mandate means markets are less sensitive to inflation news.”

“We think DXY can stay in the 100.0-101.0 range for a few days. The next big move may just come with a jobs data surprise next week.”