As markets await Federal Reserve (Fed) Chairman Jerome Powell’s reaction to the recently hawkish US data, sluggish inflation expectations seem to challenge the US Dollar Index (DXY) bulls during early Monday in Asia, following a two-day rebound from the multi-month low.
That said, the US inflation expectations per the 10-year and 5-year breakeven inflation rates from the St. Louis Federal Reserve (FRED) remain pressured despite firmer US employment data, as well as services activity numbers.
10-year inflation expectations per the aforementioned measure remained depressed near 3.22% while the five-year counterpart struggled to defend the bounce off a fortnight-low surrounding 2.27% by the end of Friday’s North American session.
It should be noted that the US employment report for January joined the upbeat US ISM Services PMI for the stated month to underpin the US Dollar Index (DXY) rebound from the lowest levels since April 2022. However, the DXY traders await Tuesday’s speech from Federal Reserve (Fed) Chairman Jerome Powel for fresh impulse.
Also read: US Dollar Index: DXY bulls take a breather around 103.00 as Fed Chair Powell’s speech looms
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