• USA vs Russia, the outcome was higher gold
  • US Core CPI marked higher, expect more Fed hikes
  • USD strengthens post FOMC minutes, gold retraced

The precious metal was well bided after Trump tweeted Russia: “Get ready” for missiles coming at Syria. As a result, the safe currency JPY was marginally strengthened across the board and the Gold price climbed to 1365.20$ but failed to breach Jan 25 high,1366.00$. The cross currency USDRUB rose by more than 3.30% later erased the gains completely.

In terms of the US data, US March CPI and Core CPI marked higher. The big positive news from US session was core inflation market higher above target 2.0%. What it means for a forex trader is expecting more hikes from Fed in 2018.

  • The Consumer Price Index decreased 0.1% in March after rising 0.2% in February, whereas the Core CPI rose 2.1%, its largest 12-month increase since the period ending February 2017.

As we pointed in our earlier article, we remain in our forecast, “expect four Fed hikes in 2018, but more confirmation will be available at the June meeting”.

We believe the Feb minutes are hawkish and will support the USD to the June meeting.

Fed minutes highlights:

Regarding trade war, the Fed said, “A strong majority of participants viewed the prospect of retaliatory trade actions by other countries, as well as other issues and uncertainties associated with trade policies, as downside risks for the U.S. economy”.

Participants’ Views on Current Conditions and the Economic Outlook

  • Several participants noted that the 12-month PCE price inflation rate would likely shift upward when the March data are released
  • Regarding wage growth at the national level, several participants noted a modest increase, but most still described the pace of wage gains as moderate
  • Several participants commented that this gradual approach was most likely to be conducive to maintaining strong labor market conditions and returning inflation to 2 percent on a sustained basis without resulting in conditions that would eventually require an abrupt policy tightening.
  • Several participants expressed the judgment that it would likely become appropriate at some point for the Committee to set the federal funds rate above its longer-run normal value for a time

What’s on today?

  • RBNZ Assist Gov speaks (NZD)
  • BOJ Governor Kuroda speaks (JPY)
  • EZ Feb IP (EUR)
  • BOE Credit conditions survey (GBP)
  • ECB minutes (EUR)
  • US Weekly employment claims (USD)
  • BOE Governor Carney speaks (GBP)

Charts pack: Symmetrical triangle patterns

It is important to always keep in mind the risks involved in trading with leveraged instruments.

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