According to our analysis EURUSD and USDJPY moved 21 pips on US BLS CPI (Consumer Price Index) data on 13 September 2023.

EURUSD (12 pips)

USDJPY (9 pips)

Charts are exported from JForex (Dukascopy).


On September 13, 2023, the United States Bureau of Labor Statistics (BLS) released data related to the Consumer Price Index (CPI). In this release, both Core CPI (excluding food and energy) and CPI Year-over-Year (YoY) exceeded market expectations by 0.1 percentage points. This data suggested a notable increase in inflationary pressures within the United States.

Market participants responded to this stronger-than-anticipated CPI data by favoring the United States Dollar (USD) in forex trading. This shift in sentiment resulted in the Euro/USD (EUR/USD) currency pair depreciating, while the USD/Japanese Yen (USD/JPY) currency pair appreciated. The rationale behind this movement was rooted in expectations of the Federal Reserve adopting a potentially more stringent monetary policy to combat inflationary pressures.

Furthermore, the CME FedWatch tool, which gauges market expectations regarding Federal Reserve actions, displayed a remarkable 97% probability that the Federal Funds Rate would remain unaltered during the Federal Reserve's upcoming meeting scheduled for September 20. This high probability reflected a strong consensus among market participants that the Federal Reserve would maintain the current target range for the Federal Funds Rate without implementing any adjustments.

In summary, the CPI data release prompted forex market reactions wherein the USD gained strength against the EUR and JPY due to expectations of a stable interest rate policy by the Federal Reserve. Additionally, the market's high level of confidence in the status quo of monetary policy was reaffirmed by the CME FedWatch tool's 97% probability of no rate changes during the forthcoming Federal Reserve meeting on September 20.

Source: https://www.bls.gov/news.release/cpi.nr0.htm


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