Global shares edged higher on Tuesday, tracking a rebound on Wall Street ahead of a key US inflation report and speeches by US Federal Reserve members, while the yen recouped losses after Japan nominated a new central bank governor.
Analysts expect headline consumer price inflation to have risen by 6.2% in the 12 months to January, vs a rise of 6.5% in December. Investors will watch for remarks from Fed members following the inflation data. Analysts and strategists have said Tuesday’s report could look more inflationary after annual changes to the methodology to give more weight to real estate.
“The main uncertainty for the dollar outlook seems to be to what extent the Fed itself was surprised by the current data or whether the recent data is still in line with the ‘bumpy’ ride of disinflation expected by the Fed.” The yen drew additional support from data that showed the Japanese economy avoided recession in the final three months of 2022, although growth did increase by a lot less than expected.