Sep 13, 2022 06:42AM ET
The dollar was heading for its longest losing streak in a year and world stocks were higher for a fifth straight day on Tuesday, ahead of US inflation data expected to show a surge in gasoline prices may have finally peaked.
Another welcome drop in European gas prices helped the STOXX 600 rise 0.2%, lifting MSCI's 47-country world index by the same amount ahead of another expected rise on Wall Street later.
Eurozone bond markets have seen yields flinch lower after German business confidence data showed growing recession anxiety there.
But the main event of the day is US inflation figures due at 1230 GMT, data that will feed into next week's Federal Reserve meeting.
Economists expect a slight decline in the headline inflation figure to around 8% year-on-year, while the core rate, which strips out the more volatile elements, is expected to see the same rise of 0.3% month-on-month as in July.
"I would concentrate on the month-on-month core number for surprises either higher or lower," said John Hardy, Saxo Bank's chief FX strategist, adding that Tuesday could be a key day for the dollar, following its recent mini-slump.
"Everyone's priced in 75 basis points (as a US rate hike next week), so it's more about whether this is a Fed top, and what happens through to the end of the year and next year."
The big drop in commodity prices over the past few months has helped cool some of the inflation fears that forced major central banks to raise interest rates sharply this year.