The USD enters the North American session unchanged to yesterday’s close. The BLS CPI revisions early this morning would leave Q4 core CPI unchanged while the December CPI reading was revised a notch lower to 0.2%. The immediate USD reaction took us to yesterday’s lows, though the move was short-lived.

EUR/USD is unchanged to yesterday’s close levels. The ECB’s Lane and Wunsch spoke yesterday, both urging caution on rates. “In terms of an overall evaluation of our policy trajectory, we need to be further along in the disinflation process before we can be sufficiently confident that inflation will hit the target in a timely manner and settle at target sustainably,” Lane said. German CPI met expectations overnight. Eurozone aggregate GDP is released next Wednesday.

GBP/USD is similarly unchanged today. Investors had pared bets to under 3 full quarter-point cuts in 2024, though odds are back above 3 cuts today. 2 days ago, investors had priced over 3.5 rate cuts for 2024. The BOE’s Haskel said he’s encouraged by signs that the UK’s inflation pressures may be declining, but would need more evidence of a cool-down before changing his stance.

USD/CAD is trading 0.1% lower today after Canada’s employment data beat expectations (37.3k job adds vs 15k expected, unemployment down 0.1% from prior to 5.7% vs 5.9% expected). Hourly wages rose 5.3% as expected. Investors currently see 3 rate cuts ahead in 2024 for the BOC, down from 3.5 earlier this week.

USD/JPY holds yesterday’s 0.8% gains. BoJ Governor Kazuo Ueda spoke last night, where he indicated that accommodative conditions are likely to stay even after the central bank abandons its negative interest rate policy, echoing other BOJ officials’ statements this week. The pair is trading at levels last seen at the end of November.

USD/MXN is 0.3% lower this morning, in-line with peers despite missing estimates of industrial production. Traders were quick to shake-off a more dovish Banxico at yesterday’s rate decision (unchanged at 11.25%), where the statement’s wording was changed to imply an interest rate cut should be considered in the coming meetings.