Geopolitical risks between the US and North Korea continue to grow, which increases the demand for safe assets. During yesterday's trading, the dx weakened significantly against the yen. The drop in the USD/JPY quotes exceeded 100 points.
Weak economic reports also put pressure on the US currency. In July, the producer price index fell by 0.1%. Experts expected the indicator rose by 0.1%. The number of initial claims for unemployment benefits increased by 1.2% to 244,000.
The representative of the Federal Reserve Dudley, who has the right to vote at the meetings of the Central Bank, is concerned about the low level of inflation in the country. It takes some time for inflation to reach the target level of 2%. The official also believes that economic growth may be low-key.
Today, the attention of the financial market participants will be focused on the inflation report in the US. Experts expect that consumer prices rose by 0.2% in July.
Market Indicators
Yesterday, aggressive sales were observed in the US stock market. Major stock indexes closed in the negative zone: #SPY (-1.41%), SPDR Dow Jones Industrial Average (NYSE:DIA) (-0.86%), PowerShares QQQ Trust Series 1 (NASDAQ:QQQ) (-2.14%).
The 10-year US government bonds yield demonstrates negative dynamics. At the moment, the indicator is at the level of 2.20%.
The dollar index closed the trading session in the negative zone (-0.14%).
Events To Watch
– inflation report in the US – 15:30 (GMT+3:00);
– speeches of the FOMC representatives Kaplan and Kashkari – 16:40 (GMT+3:00) and 18:30 (GMT+3:00), respectively.