{"id":38799,"date":"2026-01-12T12:22:47","date_gmt":"2026-01-12T04:22:47","guid":{"rendered":"https:\/\/www.vtmarkets.com\/?p=38799"},"modified":"2026-01-12T12:22:47","modified_gmt":"2026-01-12T04:22:47","slug":"week-ahead-cpi-tests-dollar-strength","status":"publish","type":"post","link":"https:\/\/www.vtmarkets.com\/en-ca\/week_ahead\/week-ahead-cpi-tests-dollar-strength\/","title":{"rendered":"Week Ahead: CPI Tests Dollar Strength"},"content":{"rendered":"\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/Image_fx-93-1024x576.jpg\" alt=\"\" class=\"wp-image-38806\" \/><\/figure>\n\n\n\n<p>After a strong dollar run and fresh equity highs, traders now face a familiar question: pause or push further?<\/p>\n\n\n\n<p>The current administration has framed economic security and national security as one system, using tariffs, energy access, and defence spending as linked tools rather than isolated policies.<\/p>\n\n\n\n<p>Since 2025, tariff revenues have generated roughly $250 to $270 billion, helping fund domestic support measures while protecting industrial capacity.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">Trump\u2019s tariff increases will cause a slump in US trade volumes that\u2019s likely to limit the scope of the extra revenue it can reel in <a href=\"https:\/\/t.co\/peMX6TJ8a9\">https:\/\/t.co\/peMX6TJ8a9<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/1909643783760691575?ref_src=twsrc%5Etfw\">April 8, 2025<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>Growth has remained firm, with US GDP estimated near 4.3 percent in Q3 2025 and closer to 5.4 percent in Q4. That resilience underpins dollar strength and reduces urgency for aggressive rate cuts, even as inflation trends lower.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">The portion of US economic output that goes to workers in the form of wages and salaries plunged to the lowest level on record in the third quarter of last year, data from the Bureau of Labor Statistics show <a href=\"https:\/\/t.co\/wdo1IeApwP\">https:\/\/t.co\/wdo1IeApwP<\/a><\/p>&mdash; Bloomberg (@business) <a href=\"https:\/\/twitter.com\/business\/status\/2009699331708760106?ref_src=twsrc%5Etfw\">January 9, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<h3 class=\"wp-block-heading has-medium-font-size\">Labour Data Anchors Dollar Strength<\/h3>\n\n\n\n<p>Last week\u2019s US labour report delivered a mixed signal for markets. <a href=\"https:\/\/www.bls.gov\/news.release\/pdf\/empsit.pdf\" target=\"_blank\" rel=\"noopener\" title=\"\">Nonfarm payrolls increased by 50,000<\/a> in December, falling short of expectations and pointing to a slower pace of hiring into the new year.<\/p>\n\n\n\n<p>The unemployment rate edged lower to <strong>4.4 percent<\/strong>, while average hourly earnings rose <strong><a href=\"https:\/\/www.bls.gov\/news.release\/pdf\/empsit.pdf\" target=\"_blank\" rel=\"noopener\" title=\"\">0.3 percent month on month<\/a><\/strong>, keeping annual wage growth near <strong>3.8 percent<\/strong>.<\/p>\n\n\n\n<p>The combination of softer job creation and steady wage pressures left the dollar supported, but reduced conviction around near-term policy shifts.<\/p>\n\n\n\n<p>The data pushed back against near-term rate cut expectations and helped drive broad-based dollar demand into the weekly close, particularly against the euro and yen.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Oil Keeps Afloat<\/h2>\n\n\n\n<p>Energy also sits at the centre of this framework. Increased US shale output alongside renewed Venezuelan supply has helped cap oil price volatility, easing inflation pressure while limiting OPEC\u2019s pricing power.<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"500\" data-dnt=\"true\"><p lang=\"en\" dir=\"ltr\">\ud83d\udd0a Why is the U.S. Coast Guard seizing tankers carrying Venezuelan oil? Energy reporter <a href=\"https:\/\/twitter.com\/mariannaparraga?ref_src=twsrc%5Etfw\">@mariannaparraga<\/a> joins On Assignment to break down the global fight over Venezuela\u2019s natural resources. Listen here: <a href=\"https:\/\/t.co\/JVjZr9fU5l\">https:\/\/t.co\/JVjZr9fU5l<\/a> <a href=\"https:\/\/t.co\/uNRkJcy8Eq\">pic.twitter.com\/uNRkJcy8Eq<\/a><\/p>&mdash; Reuters (@Reuters) <a href=\"https:\/\/twitter.com\/Reuters\/status\/2010290639540244572?ref_src=twsrc%5Etfw\">January 11, 2026<\/a><\/blockquote><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>\n<\/div><\/figure>\n\n\n\n<p>For traders, this keeps energy-driven inflation spikes less likely in the near term, reinforcing the market\u2019s current preference for range trading rather than crisis hedging.<\/p>\n\n\n\n<p>The dollar remains a key beneficiary. With most energy trade still clearing through US channels, demand for <a href=\"https:\/\/t.co\/ZTdWr4qakU\" target=\"_blank\" rel=\"noopener\" title=\"\">dollar liquidity stays elevated<\/a>.<\/p>\n\n\n\n<p>This supports the greenback structurally, even as short-term moves respond to CPI and PPI data. Risks remain, including legal challenges to tariff authority and broader de-dollarisation efforts, but these sit more in the medium-term horizon than this week\u2019s trade setups.<\/p>\n\n\n\n<p>Against this backdrop, inflation data takes on added weight.<\/p>\n\n\n\n<p>A steady CPI print would reinforce the idea of controlled disinflation within a strong growth and fiscal framework, keeping markets biased toward consolidation rather than sharp reversals.<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Key Symbols to Watch<\/h2>\n\n\n\n<p>USDX | XAUUSD | EURUSD | SP500 | BTCUSD<\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Key Events of the Week<\/h2>\n\n\n\n<figure class=\"wp-block-table is-style-stripes\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Date<\/strong><\/td><td><strong>Currency<\/strong><\/td><td><strong>Event<\/strong><\/td><td><strong>Forecast<\/strong><\/td><td><strong>Previous<\/strong><\/td><td><strong>Analyst Remarks<\/strong><\/td><\/tr><tr><td>13 Jan<\/td><td>USD<\/td><td>CPI y\/y<\/td><td>2.70%<\/td><td>2.70%<\/td><td>Directional driver for USD and risk sentiment<\/td><\/tr><tr><td>14 Jan<\/td><td>USD<\/td><td>PPI m\/m<\/td><td>\u2013<\/td><td>0.30%<\/td><td>Focus on pipeline inflation pressure<\/td><\/tr><tr><td>15 Jan<\/td><td>GBP<\/td><td>GDP m\/m<\/td><td>0.00%<\/td><td>-0.10%<\/td><td>Growth data may impact sterling volatility<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p><strong>For full view of upcoming economic events, check out VT Markets&#8217; <a href=\"https:\/\/www.vtmarkets.com\/economic-calendar\/\" target=\"_blank\" rel=\"noopener\" title=\"\">Economic Calendar<\/a>.<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Key Movements Of The Week<\/h2>\n\n\n\n<h3 class=\"wp-block-heading has-medium-font-size\">US Dollar Index (USDX)<\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1439\" height=\"748\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/d7f3b273-440e-46b5-9ab0-30dee781245d.png\" alt=\"\" class=\"wp-image-38809\" \/><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The dollar climbed all week and closed near the 99.10 resistance zone.<\/li>\n\n\n\n<li>Consolidation could open pullbacks toward 98.20 or 97.95.<\/li>\n\n\n\n<li>A break higher places focus on the 99.70 area.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Gold (XAUUSD)<\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1439\" height=\"749\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/c26b9ccb-eccb-44c0-bf67-ac2dac1aa8ae.png\" alt=\"\" class=\"wp-image-38807\" \/><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Gold pushed above the 4,500 swing high, extending the bullish structure.<\/li>\n\n\n\n<li>Follow-through above 4,550 would keep momentum intact.<\/li>\n\n\n\n<li>Failure to hold recent gains may invite short-term profit-taking.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">S&amp;P 500<\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1439\" height=\"744\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/858e75fd-10cc-4dfe-af61-2b2d7afa0c9c.png\" alt=\"\" class=\"wp-image-38810\" \/><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The index printed a fresh all-time high.<\/li>\n\n\n\n<li>Upside extension targets sit near 7,000 and 7,050.<\/li>\n\n\n\n<li>Traders may watch for slowing momentum after the strong run.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Bitcoin (BTCUSD)<\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1439\" height=\"744\" src=\"https:\/\/www.vtmarkets.com\/en-ca\/wp-content\/uploads\/sites\/13\/2026\/03\/28382a27-0903-432f-85d8-f180fe8572b3.png\" alt=\"\" class=\"wp-image-38808\" \/><\/figure>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Bitcoin continues to trade within a wide range.<\/li>\n\n\n\n<li>84,445 remains a key downside level to defend.<\/li>\n\n\n\n<li>Rallies toward 98,730 may face renewed selling pressure.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading has-medium-font-size\">Bottom Line<\/h2>\n\n\n\n<p>US CPI will likely decide whether recent trends extend or stall, particularly after a strong start to the year for the dollar and US equities.<\/p>\n\n\n\n<p>A steady inflation print supports the view of controlled disinflation rather than a rapid slowdown, keeping policy expectations anchored and volatility contained.<\/p>\n\n\n\n<p>With inflation, growth, and policy narratives tightly linked, this week\u2019s data flow may determine whether markets pause to digest gains or find room to push further.<\/p>\n\n\n\n<p><strong>Create a <a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\" target=\"_blank\" rel=\"noopener\" title=\"\">live VT Markets account<\/a> today to access our platform features, including market insights and educational content.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Markets enter the new week with US inflation data in focus as traders assess dollar strength, equity highs, and extended moves in gold and crypto.<\/p>\n","protected":false},"author":64,"featured_media":38806,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[33],"tags":[32],"class_list":["post-38799","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-week_ahead","tag-analysis"],"acf":{"acf_article_selection_author":""},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/38799","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/users\/64"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/comments?post=38799"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/posts\/38799\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media\/38806"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/media?parent=38799"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/categories?post=38799"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-ca\/wp-json\/wp\/v2\/tags?post=38799"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}