US Dollar peaks on Chicago PMI reading

The US dollar trades in the green against all major currencies. US traders are seeing PCE confirming sticky pace of inflation. The US Dollar Index climbs above 103 and could still flip this week’s overall performance into positive territory.

The dollar bulls are being back by Wednesday and Thursday’s data points, confirming that the US economy is not dead just yet; and that inflation is not coming down that quickly as expected. With the Personal Consumption Expenditures, the preferred inflation gauge from the US Federal Reserve, traders got a look under the hood on what US inflation is doing.

is a much-telling tale of two speeds where obviously European inflation is almost free-falling, while US inflation is rather sticky and only goes down.

On the economic front, all, or at least most important datapoints are behind us for this Thursday. The fact that nearly all PCE elements, both Headline and Core Expenditures fell in line of expectations, shows that the Fed is still right to say that inflation is a force to be reckoned with.