On April 13th, data released by the US Bureau of Labor Statistics on Friday showed the Consumer Price Index (CPI) rose 0.9% month-on-month in March, matching market expectations and marking the largest monthly increase since June 2022. Year-on-year, it increased by 3.3%, a significant acceleration from the 2.4% recorded in February, reaching the highest level since 2024. Gasoline prices saw their largest monthly increase since records began in 1967, almost single-handedly driving the overall monthly gain and contributing nearly three-quarters of the increase. The core CPI, which excludes food and energy, rose only 0.2% month-on-month, below the market expectation of 0.3%, providing some comfort to the market and increasing short-term bets on interest rate cuts. However, economists warned that the secondary effects of this round of energy shocks have not yet been fully reflected in core inflation, posing a risk of further increases in the April data.

Additionally, preliminary data from the University of Michigan released on Friday showed the Consumer Sentiment Index for April dropped sharply to 47.6 from 53.3 in March, against an expectation of 51.5. The survey period covered March 24th to April 7th. This figure was lower than almost all results in economist forecasts surveyed by media, only higher than one. Consumers expect prices to rise at an annual rate of 4.8% over the next year, a significant increase of 1 percentage point from 3.8% in March, marking the largest rise since the announcement of comprehensive tariffs a year ago; market expectations were for 4.2%. People expect costs to rise at an annual rate of 3.4% over the next five to ten years, matching expectations and slightly above the previous month's 3.2%.

Data to watch today include Canada's monthly Building Permits for February and the US annualized total of Existing Home Sales for March.

US Dollar Index The US Dollar Index moved with consolidation on Friday, ending the day with a slight loss. Continued cooling of safe-haven demand was one factor pressuring the index, while diminished expectations for Federal Reserve rate hikes also contributed to the ongoing correction. In early Asian trading, the Dollar Index gapped higher as the breakdown of US-Iran talks reignited risk aversion; the index is currently trading around 99.00. Attention today is on resistance near 99.50, with support found around 98.50.

EUR/USD The Euro traded with an upward bias on Friday, closing slightly higher. A softer US Dollar, pressured by cooling safe-haven demand and reduced Fed rate hike expectations, was the main factor supporting the Euro's gain. Furthermore, better-than-expected German CPI data during the session also provided some support. In early Asian trading, the Euro edged lower amid renewed risk aversion, currently trading around 1.1690. Focus today is on resistance near 1.1800, with support around 1.1600.

GBP/USD The British Pound consolidated on Friday, ending the day with a modest gain; it is currently trading around 1.3410. A weaker US Dollar, weighed down by cooling safe-haven demand and fading Fed rate hike expectations, was the primary driver behind the Pound's advance. However, tempered expectations for Bank of England rate hikes limited the pair's upside potential. Attention today is on resistance near 1.3500, with support around 1.3300.