Hello traders, let’s start with fundamentals. Yesterday’s macro calendar was focused on CPI inflation. On a monthly basis, core CPI came in slightly below expectations at 0.2% versus the 0.3% forecast. Headline CPI on both a monthly and yearly basis printed exactly in line with market expectations. The market reaction was mixed and unfolded in two stages. The initial move was a weakening of the US dollar, reflecting the softer core inflation print. However, during the second half of the session, the dollar reversed and strengthened noticeably, suggesting that the market ultimately interpreted the data as neutral rather than dovish.
Looking at today’s calendar, inflation remains in focus with the release of PPI, producer price inflation, alongside retail sales data. These releases will be key for short-term expectations around inflation pass-through and consumer strength.
From the fundamental and political angle, there are two notable developments coming from Donald Trump. First, he once again criticized Jerome Powell, calling him either incompetent or dishonest, which further escalates the ongoing conflict between the White House and the Federal Reserve. Second, Trump stated that the administration intends to push oil prices lower. This is an interesting comment, particularly given the recent price action in crude oil. Over the past two weeks, Brent crude has rallied sharply, moving from the 59–60 dollar area toward the mid-60s, making this upswing technically and fundamentally significant.
In terms of broader market sentiment, equity indices are mixed. Asian markets are trading higher, while US equity futures are hovering close to flat, signaling indecision ahead of today’s macro releases. On the currency market, the dollar is showing early signs of corrective weakness after yesterday’s strength. At the same time, the Japanese yen remains under pressure, extending its recent weakening trend.
Commodities continue to show strength, particularly in metals. Despite being only halfway through January, copper is up roughly 8% year to date. Gold is nearly 7% higher, while silver has surged close to 28% in just the past two weeks, highlighting strong momentum and sustained demand across the metals complex.
Finally, cryptocurrencies are also moving higher. Bitcoin is up close to 2% on the day, while Ethereum is outperforming with gains approaching 5%. This suggests that risk appetite remains intact despite mixed signals from macro data and currencies.