We're heading towards another guessing game now as all the bets today are going to involve the US CPI data release. If the numbers do come in around estimates, I would argue it should support a 25 bps rate hike at the margin.
But as markets digest the numbers, there might be more pushing and pulling before the day/week is over. Let's not forget that there is also the Fed minutes to be released later in the day.
Some key spots to watch are still the bond market, gold, euro and sterling (vs the dollar), as well as yen pairs in general. Those will continue to react in a rather sensitive manner to the Fed outlook given the prevailing circumstances.
Besides that, European equities are also in an interesting position with the DAX and CAC 40 lurking at the highs for the year. Then, we have oil which is knocking on the door of a further upside break as price holds above $80 but still below key resistance around $82.35-60 for now.
The loonie is also one to pay attention to with the BOC policy decision coming up but there shouldn't be much surprises as the central bank is expected to keep rates unchanged again.
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