USD slightly up but still near five-month low ahead of May CPI which would come later in the day

USD was slightly up on Thursday morning in Asia, reaching above the 90 level. Currently DXY Index trades around 90.2, still near its five-month low. All eyes on the market are focusing on two key events today: US CPI in May and ECB rate decision. Last month, investors have witnessed the largest inflation jump in 12 years, bringing much worries that the Fed would raise interest rate earlier than expected. The worry has temporarily pushed up USD, which quickly declined after the Fed reiterated that its policy will remain unchanged. On the other hand, in China, central bank governor recently predicted that inflation would stay under 2% in 2021, below the official target at 3%.

Regarding the ECB meeting, investors will be looking for signs of tapering. Although the market consensus is that interest rate and asset purchasing will stay unchanged, any signs of tightening would impact EUR’s movement.