• The Dollar firmed against its peers and traded near a six-month high against the yen on Thursday as the U.S. Labor Department's expectation-beating inflation report boosted confidence in the world's top economy.
The latest U.S. economic data reaffirmed expectations that the Federal Reserve will hike interest rates two more times this year.
The U.S. Dollar Index, which tracks the greenback against a basket of currencies, was up 0.04% at 94.76 by 12:11AM ET (04:11 GMT).
• Analysts at TDS, expect a reading for US June CPI of 0.2% m/m. They see risks as skewed to the downside following the PPI report.
“Firmer imported consumer goods prices and a rebound in shelter costs underpin a 0.2% m/m print in core CPI, a trend-line print that is unlikely to sway Fed views to the more hawkish side.”
“We will however, be on guard for signs of additional firmness in the underlying measure which, at the margin, will lend to (very) modest USD support though nothing to write home about we think. In the event this fails to materialize we think there is limited scope on USD downside as FX focus is distracted at the moment with trade top of mind following the latest trade salvo fired towards China. Overall, this leaves us on neutral footing for the USD.”
• Even as Beijing vows more retaliation in the trade war against Washington, there are measures being taken by the communist government to help cushion the blow from recent levies.
China is preparing its agriculture industry to cope with less soy, a major import from the U.S., while also offering financial assistance to companies across several industries.
• South Korea on Thursday warned that an escalating trade dispute between the United States and China could hit its exports of “intermediary goods” used to make home appliances, computers and communications devices.
• South Korea’s central bank held its base rate steady on Thursday, as expected, but one board member’s dissenting vote may have raised the odds of a rate hike in coming months as major peers tighten monetary policy.
• China is preparing to give swift regulatory approvals to India-manufactured drugs, the head of an Indian export promotion group said, as Beijing looks for new commercial partners ahead of what could be a protracted trade war with the United States.
Indian firms are looking to fill gaps in Chinese demand for generic drugs, software, sugar and some varieties of rice, trade officials in New Delhi said.
• U.S. crude oil exports to India hit a record in June and so far this year are almost double last year’s total as the Asian nation’s refiners move to replace supplies from Iran and Venezuela in a win for the Trump administration.
U.S. President Donald Trump’s administration has been pressuring its allies to cut imports of Iranian goods to zero by November and India’s shift advances the U.S. administration efforts to use energy to further its political goals.
• Oil prices rallied on Thursday, recouping some ground following sharp losses the previous session after Libya said it would resume oil exports.
Benchmark Brent crude oil LCOc1 rose $1.37, or almost 1.9 percent, to a high of $74.77 a barrel before easing back to trade around $74.50 by 0820 GMT. On Wednesday, Brent had slumped $5.46 or 6.9 percent.
U.S. light crude CLc1 gained 25 cents to $70.63 a barrel, after falling 5 percent the previous session.
Reference: Reuters, CNBC, FXStreet
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