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Stocks rally despite high US inflation

FX:GBPUSD   British Pound / U.S. Dollar
EUR/USD 🔼
GBP/USD 🔼
AUD/USD 🔽
USD/CAD 🔽
USD/JPY 🔼
XAU 🔽
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Yesterday, the US Consumer Price Index data released had a 0.4% month-on-month increase and an 8.2% year-on-year increase, both higher than market estimates. Fear sentiment soon faded after an initial plunge in stocks, and a rally followed. All three major indices closed higher, with Dow Jones hitting a week-high at 11,056.

Instead of witnessing a strong greenback upon prospects for more Federal Reserve rate hikes, USD/CAD peaked at 1.3964 yesterday and last traded at 1.375 with minor losses. USD/JPY reached 147.66, a 32-year high, to a closing price of 147.22. AUD/USD recovered from a 2-1/2-year low of 0.6170 and closed at 0.6298 with minor gains.

The British Pound hit great strides as the market expects more U-turns regarding tax cuts mentioned in the proposed “mini-budget”. GBP/USD gained over 220 pips to 1.1329. EUR/USD hit a low of 0.9642, then bounced back to 0.9773. German Consumer Price Index had increased by 10% compared to last year.

Gold price briefly slumped to $1,644 and back to $1,666.26 an ounce. Although crude-oil inventories increased by 9.88 million barrels, against market projections of 1.75 million, WTI oil futures still rose and stabilized at $89.11 a barrel.

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