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USD Benefits From Modest Hawkish Fed Repricing Post-CPI

CROSS ASSET

The initial round of post-CPI trade sees a hawkish steepening on the FOMC-dated OIS strip, with terminal policy rate pricing now ~9.5bp above prevailing levels vs. ~7bp pre data (still located in December). Beyond that, ~53bp of cuts is now priced through September ’24 vs. current terminal rate levels, compared to ~60bp pre-release.

  • Greenback snaps stronger as a result.
  • EUR/USD drops toward, but holds just above, yesterday's late lows of 1.0583 - but pair still remains higher on the week by ~30 pips.
  • USD/JPY through yesterday's highs, to print a new weekly best at 149.37.
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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