LOOK AHEAD: US Week Ahead Headlined By Delayed CPI Report On Friday
Oct-17 20:51
- The September US CPI report will be released on Friday, delayed amidst the government shutdown but with the BLS making a special exception on social security payment considerations.
- Bloomberg consensus looks for headline CPI inflation at a rounded 0.4% M/M after 0.38% back in August and for Y/Y inflation to firm two tenths to 3.1% for what would be its highest since May 2024.
- Core inflation is seen at a rounded 0.3% M/M after 0.35% in August (exceeding the median unrounded estimate of 0.31%) and 0.32% in July. It’s expected to see core CPI inflation hold at 3.1% Y/Y having in August increased to its highest since February.
- Core details should see focus on both goods and services angles: underlying goods inflation has clearly firmed in recent months on tariff pressures although the median increase has currently seen a peak back in June, whilst services will be watched for any spillover after some strong recent non-housing readings.
- The report will come within the FOMC blackout period ahead of the Oct 28-29 decision, with a 25bp cut fully priced and likely needing a large surprise to alter this.
- As for broader inflation details, Fed Chair Powell this week confusingly suggested that we will have the September PPI report but the BLS had previously said “No other releases will be rescheduled or produced until the resumption of regular government services”.
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
USDCAD TECHS: Strong Sell-Off Exposes Support
Sep-17 20:28
- RES 4: 1.4019 38.2% retracement of the Feb 3 - Jun 16 bear leg
- RES 3: 1.3925 High Aug 22 and the bull trigger
- RES 2: 1.3890 High Sep 11
- RES 1: 1.3803 20-day EMA
- PRICE: 1.3773 @ 21:21 BST Sep 17
- SUP 1: 1.3727 Low Aug 29 and a bear trigger
- SUP 2: 1.3709 61.8% retracement of the Jul 23 - Aug 22 bull cycle
- SUP 3: 1.3658 76.4% retracement of the Jul 23 - Aug 22 bull cycle
- SUP 4: 1.3637 Low Jul 25
A sharp sell-off in USDCAD this week has resulted in a break of the 20-and-50-day EMAs. This undermines a recent bullish theme and exposes key short-term support at 1.3727, the Aug 27 low. A clear break of this level would strengthen a bearish threat and signal scope for a deeper retracement. For bulls, resistance levels to watch are; 1.3890, the Sep 11 high, and 1.3925, the Aug 22 high and bull trigger.
AUDUSD TECHS: Bulls Remain In The Driver’s Seat
Sep-17 20:19
- RES 4: 0.6793 1.500 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 3: 0.6763 1.382 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 2: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 1: 0.6707 High Sep 17
- PRICE: 0.6657 @ 21:15 BST Sep 17
- SUP 1: 0.6579/6537 20- and 50-day EMA values
- SUP 2: 0.6463/6415 Low Aug 27 / Low Aug 21 / 22 and a bear trigger
- SUP 3: 0.6373 Low Jun 23
- SUP 4: 0.6354 38.2% retracement of the Apr 9 - Jul 24 upleg
AUDUSD bulls remain in the driver’s seat. The latest rally plus the breach of 0.6625, the Jul 24 high and bull trigger, confirm a resumption of the uptrend. The climb opens the 0.6700 handle next. Moving average studies are in a bull-mode position highlighting a dominant uptrend. Key support to watch is 0.6415, the Aug 21 / 22 low. Initial firm support to monitor lies at 0.6579, the 20-day EMA.
US TSYS: Markets Whipsaw after Fed Delivers 25Bp Cut
Sep-17 20:17
- US Treasuries look to finish near late session lows, completely reversing the initial rate cut move rally - to weaker across the board after the bell with Dec'25 10Y futures just through early session low of 113-08 t0 113-02 (-15.5), 10Y yield +.0439 4.0718%.
- Treasury futures had extended highs after the FOMC annc 25bp rate cut, Fed Gov Miran the sole dissenter in favor of a 50bp cut. Tsy Dec'25 10Y futures climbing +8 to 113-25.
- Still digesting mixed messaging, Chairman Powell: "it's not a bad economy ... it's challenging to know what what to do ... there are no risk free paths. Now it's not incredibly obvious what to do."
- Meanwhile "downside risks to employment have risen," the Fed said in its post-meeting policy statement. "Job gains have slowed, and the unemployment rate has edged up but remains low. Inflation has moved up and remains somewhat elevated."
- However, a confident sounding Chair Powell on the US economy as a whole and the mixed messages within the summary of economic projections questioned the overall dovish narrative and subsequently the US dollar aggressively reversed higher alongside US treasury yields.
- Focus turns to Thursday's weekly claims Leading Index and Net TIC Flows.
