On the inflation side, the PCE deflator (the Fed’s preferred inflation measure) for the fourth quarter was revised higher from 2.0% to 2.1% and we’ll see January numbers today. Our expectations are for a 0.4% core MoM print, which in our view will endorse the recent hawkish repricing of Fed rate expectations.

From an FX point of view, we see the Dollar finding some support today on the back of the release. Data on personal spending and the weekly jobless claims report should also impact USD. 

The EUR-heavy DXY index may well be impacted by initial CPI figures out of the Eurozone today, but we think it is more likely to end the week above 104.00 than below.