US indices declined after worse data on retail sales and higher inflation in the country. Consumer prices rose more than the January forecast, as clothing costs for US citizens rose to levels over three decades ago.
Retail sales also declined by -0.3%.
These figures are, at first glance, with minimal changes to the previous period, but make investors doubt the strength of the US economy. The increased inflation that drives the market correction is again rising and this is a major concern for investors as the data will push the Fed to raise interest rates by more than expected 4 times in 2018. The higher interest rate leads to a more expensive dollar. With the exception of JPY, the USD is currently trading on a rise against major currencies. For its part, the Yen as a currency of currency marked an increase of 0.62%. 10-year US bond yields picked up again to 2.8766 percent. High bond yields will result in the allocation of capital from the equity market to fixed income instruments, and this will further add to the indexes.
Following the announcement of the data, the likelihood of rising interest rates during all upcoming Fed meetings in 2018. jumped to over 92% - in other words, increases are almost certain.
Source: Bloomberg Pro Terminal
Jr Trader Petar Milanov
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