Midday brief – CPI Day is upon us

The surprise jump in UK inflation supports another BoE rate hike in coming meetings. The Euro area’s inflation came in as anticipated without much effect on the Euro. Officials from the Bank of Japan remained adamant about keeping ultra-low interest rates.

GBPJPY surged +0.60% in the aftermath of hotter-than-expected inflation data from the UK. Consumer Price index year-on-year scaled back into double digits in March printing 10.1% beating expectations of 9.8%. The pound’s strength was also supported by a rise in the producer price index input which settled at 0.2% from last month`s 0.0%.

The data boosted the sterling on rate hike bets by the BoE. The Yen continued to be subdued as BoJ officials stamped their feet on easy monetary policy. The Bulls took over from the 166.50 low and faced a challenge at 168.00. A number above may set targets at 169.50.

EURUSD traded -0.46% lower as bulls gave up the 1.0950 mark on the dollar rebound. Eurostat showed that headline inflation in the Eurozone rose as anticipated to 6.9% from the previous 8.5% in March. Despite being more than the previous, the data was without much help to the Euro.

The buck took a breather on Wednesday as investors shy away from risk. Traders await high-impact data for clear direction in the market. The pair`s downside traction may face a hurdle at the 1.0900 low.

CADZAR rose +0.28% as the Canadian dollar remained resilient against the South African Rand despite higher inflation figures. The consumer price index {YoY} in South Africa was at 7.1% vs the surveyed 6.9% while the month-on-month figure rose to 1.0% from 0.7%.

On Tuesday, Statistics Canada released the country’s core CPI data which was 0.6% monthly reading and 4.3% yearly. Further up bulls may need to challenge the 13.700 mark for an extended buying. However, a reprice of 13.44 may be witnessed in the short term.

European equities slumped in European trade as UK CPI data boosts the probability of a BoE rate hike. The FTSE 100 lost -0.42% as bears returned below the 7900 mark. France40 shed -0.25% past the 7550 level as bears target 7400. DAX was down -0.32% with sellers eyeing 15 800 and 15 700.

US stock futures were down as investors awaited earnings from tech companies. The Nasdaq futures lost -0.77% sliding towards 12 800. S&P 500 futures were trading at -0.48% as targets may be seen at 4100. DJIA futures were down -0.27% with targets at 33 570 on the slide.

In commodities, crude oil prices tanked on reports that Kurdish oil output which totalled 450 000 barrels per day was to resume this week. The black liquid’s price slumped on increased supply ahead of the crude oil inventories data release today. Brent crude oil was down -3.88% as bears seek to cover a gap between $ 83.45 and $80.00. US oil lost -4.21% with targets at $76.00 on the downside.