The US announced a positive consumer price index, CPI dropped sharply from 4.9% to 4%, lower than the 4.1% forecast.
However, the core inflation data (core CPI) of the US only decreased slightly from 5.54% to 5.33%.
Although the consumer price index fell sharply, the core inflation index did not appear to have declined correspondingly, so Dow Jones increased only slightly by 145 points. US bond yields still rose from 3.69% to 3.82% after inflation data.
On the surface, the index is quite positive, but if look at the index’s reaction and interest rate signals, it can be seen that it is still necessary to be cautious to see how the Fed will judge next Thursday, June 15th.
**Factors that support the price increase:
– US planting area in 2023 was expected to be significantly lower than in 2022
– U.S. weekly export sales surge
– Drought situation across West Texas
– ICE handover July – December
**Factors that support falling prices:
– Australian cotton production increased
– Brazilian cotton production increased
– Cotlook forecasts world production will exceed consumption by nearly 4 million bales by 2023/24
– USD stronger
Resistance: 85.32
Support: 77.32
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