The US economy has begun to recover but growth will be modest which should keep price pressures contained. It is far too early to pop champagne corks, he says.

Dudley had no comment on the move by the Fed overnight to raise the discount rate.

EUR/USD is stabilizing around the 1.3520 level.

CPI will be more closely watched than usual today after yesterday’s PPI spike and the discount rate move. If inflation heats up, the market will be a good deal more sensitive than they may have been a few days ago.