Investors eye US inflation report on wednesday after disappointing jobs data

We’re seeing a slightly softer trading session on Tuesday as investors eye crucial inflation data on Wednesday.

We’ve finally reached the point at which the Federal Reserve may be at the end of its tightening cycle and we can start to look forward to when it can feasibly begin to ease policy in order to offset any shock to the economy. But in order for either of these to occur, we need to see evidence in the data that the Fed is on a path to 2% starting tomorrow.

The FOMC will not hesitate to raise one more time if the data doesn’t deliver between now and June 14th, regardless of the signals they’re seeing and small steps in the right direction in the labour market, for example. There should be more than enough in that time to warrant a pause but after that jobs report on Friday, it wouldn’t hurt to avoid a nasty surprise in the CPI. Or the odds of a hike next month may increase significantly from the 8% they stand at currently.

Is a crypto correction on the cards?

Bitcoin has been struggling at $30,000 again in recent days and another heavy decline on Monday could set up an interesting test around $27,000, an area that has been a reliable support level since late March. A break of this level could signal a correction of the incredible 2023 rally is on the cards, with $25,000 being the next major potential support level below.

For a look at all of today’s economic events, check out our economic calendar:

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Craig Erlam

Craig Erlam

Former Senior Market Analyst, UK & EMEA at OANDA
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary.

His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News.

Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.