The big jump in core inflation has opened a few eyes this morning. The Fed"s protestations that the US is not out of the inflation woods may begin to have a bit more resonance as a result.
The core rose 0.6% versus expectations of a milder 0.2% rise. Market reaction was to buy the USD briefly, but dealers want to wait for TIC data before aggressively jumping into the market. EUR/USD reached 1.2511 before bouncing back to the present 1.2526 level. Offers are eyed in the 1.2545 area near-term while bids are seen near 1.2500 ahead of expiries at 14:00 GMT.
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