Article Highlights

  • U.S. core PCE price index up by 0.1% as expected
  • U.S. quarterly employment cost index up by 0.5%
  • U.S. personal spending increased by 0.4%, personal income stayed flat
  • U.S. UoM revised consumer sentiment figure at 81.2
  • Chinese official manufacturing PMI down from 51.0 to 50.5 in Jan
  • Australian building approvals down by 2.9%
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Volatility kicked into high gear last Friday, as most traders booked profits ahead of the Chinese New Year long weekend. The U.S. dollar had a mixed performance against its major currency rivals while economic data also came in mixed.

The U.S. core PCE price index, which is rumored to be the Fed’s preferred inflation measure, ticked up by 0.1% as expected while the quarterly employment cost index showed a 0.5% increase. Personal spending was up by 0.4% but personal income stayed flat. Consumer sentiment stayed strong, as the UoM revised consumer sentiment figure stood at 81.2.

Meanwhile, data released over the weekend reflected signs of weakness in China and the emerging economies. The official manufacturing PMI slid from 51.0 to 50.5 in January, indicating a weaker expansion in the industry, while the non-manufacturing PMI declined from 54.6 to 53.4. For Australia, building approvals dropped by a whopping 2.9% in December while ANZ job advertisements slipped by 0.3%.

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