US CPI grew by 0.2%

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in February on a seasonally adjusted basis after rising 0.5 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months,nthe all items index rose 2.2 percent before seasonal adjustment. The indexes for shelter, apparel, and motor vehicle insurance all rose and contributed to the 1-month seasonally adjusted increase in the all items index. The food index was unchanged in February, as a decline in the index for food at home offset an increase in the food away from home index.

U.S. government posts $215 billion deficit in February

The U.S. government had a $215 billion budget shortfall in February as revenues into the government's coffers fell and outlays increased, the Treasury Department said on Monday. That compared with a budget deficit of $192 billion in the same month last year, according to Treasury's monthly budget statement. Economists polled by Reuters had forecast the Treasury recording a $216 billion deficit last month. The deficit for February was not affected by timing-related transactions. The deficit for the fiscal year, which began in October, was $391 billion, compared to a deficit of $351 billion in the same period of fiscal 2017. When accounting for calendar adjustments, the deficit for the fiscal year to date was $448 billion, compared to an adjusted total of $390 billion for the prior fiscal year.

Dollar tumbles, hurt by benign wage inflation, tariff action

The dollar fell on Monday, pressured by data showing persistently low wages that will likely constrain the U.S. Federal Reserve from raising interest rates more than three times this year. Friday’s non-farm payrolls report showed U.S. job gains for February were much higher than expected, but wage inflation, a closely watched indicator by the Fed, remained subdued. “Mixed messages on America’s labour market last week largely offset and, importantly, failed to move the dial in favour of faster rate hikes from the Fed,” said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

USD - Major events in the week ahead

Events that marked the week:

On Monday ISM Non-Manufacturing PMI data was published. The NMI® registered 59.5 percent, which is 0.4 percentage point lower than the January reading of 59.9 percent. According to the NMI®, 16 non-manufacturing industries reported growth. The non-manufacturing sector reflected the second consecutive month of strong growth in February. The decrease in the Employment Index possibly prevented an even stronger reading for the NMI® composite index. The majority of respondents’ continue to be positive about business conditions and the economy.