Dollar ignores strong PPI as focus turns to FOMC

Dollar ignores stronger than expected PPI reading and is trading down against all but Sterling and Yen for the day.

Headline PPI rose 0.5% mom, 3.1% yoy in May, versus expectaiton of 0.2% mom, 2.8% yoy. Core PPI rose 0.3% mom, 2.4% yoy, versus expectation of 0.2% mom, 2.3% yoy.

Focus will now turn to FOMC rate decision today. Fed is widely expected to raise federal funds rate by 25bps to 1.75-2.00%. Voting will be the first thing to watch even though it will very likely be unanimous. Fed will also release updated economic projections.

Here are some previews

• FOMC Preview – Fed’s Rate Hike A Done Deal, Focus Turned to Forward Guidance
• FOMC Meeting: Rate Hike A ‘Done Deal’ But What About Inflation?
• Dollar Firm as Rate Hike Imminent; But Will Fed also Raise Rate Path Forecast?