|07:30||Switzerland||Consumer Price Index (MoM) ||January||-0.2%||0.4%||0.6%|
|07:30||Switzerland||Consumer Price Index (YoY)||January||2.8%||2.9%||3.3%|
USD strengthened against most of its rivals in the European session on Monday as investors took a cautious stance, awaiting tomorrow's inflation report from the U.S., which could define the Federal Reserve’s near-term rate moves.
The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, edged up 0.09% to 103.73.
Economists expect Tuesday’s release will confirm that U.S. inflation has already peaked and is now moderating. The annual headline inflation rate is expected to slow to 6.2% in January 2023 from 6.5% in December 2022, while the core inflation rate is predicted to decelerate to 5.5% from 5.7% in the previous month.
According to CME FedWatch Tool, markets are now pricing in an 87.8% chance of another 25-basis-point interest rate hike at the Fed’s March meeting and a 69.5% probability of a similar move in May.
Hotter-than-expected Tuesday’s inflation report may build investors' expectations on the May interest rate increase.
Later in the week, markets will also receive data on U.S. retail sales and industrial production for January.