Daily Forex Highlights – Jun 11 – CPI meets expectations as markets scale back Fed hike bets

📌 Top Story

US CPI meets expectations at 4.2%; markets scale back Fed hike bets

What happened: US May CPI came in at 4.2% year-on-year, in line with forecasts and the highest since April 2023. Core CPI hit 2.9%, also as expected and the highest since September 2025. Short-term rate futures show markets have reduced their Fed hike bets.

Why it matters: Inflation is sticky but not surprising. The market had been pricing a possible rate hike. Those bets are now fading.

Market impact: 🟡 Neutral for the dollar. The data confirms the Fed's "higher for longer" stance without adding urgency to hike.

🔥 Quick Takes

Dollar

- 📊 Short-term rate futures: Markets have reduced Fed hike bets → The aggressive rate hike bets from last week are fading. No imminent move.

- 📈 US May CPI: 4.2% year-on-year (in line), highest since April 2023; core CPI 2.9% (in line), highest since September 2025 → Inflation remains elevated. No surprise, but no relief either.

- 🗣️ BLS nominee Matsumoto: Will focus on alternative data sources. Does not expect political pressure. Some issues with large downward revisions may be tied to statistical models. → A commitment to data integrity. Markets may gain confidence in jobs data.

Other

- 🇹🇭 Bank of Thailand: The baht is weak but stable → No cause for alarm. The central bank is not rushing to act.

- 🇷🇺 Putin: We have reason to expect a rate cut → A dovish signal from Moscow. The ruble may face pressure.

- 🇨🇦 Bank of Canada holds rates as expected, says future moves could be either way → A neutral stance. The loonie has no clear direction.

- 🇿🇦 SARB governor: The rand has been unexpectedly stable. Trade conditions remain favorable. → A positive assessment. No immediate pressure on the currency.

- 🇰🇷 Korea vice finance minister: Asking exporters to help improve FX supply-demand and ease volatility → A call for cooperation. Not intervention, but a step toward it.

- 🇯🇵 BOJ Governor Ueda hospitalized, will miss next week's rate decision. Deputy governor will chair the meeting. → A leadership gap at a key moment. Markets will watch for any signal shifts.

- 🇩🇪 German economic institute: Expects 0.8% growth in 2027. The economy may contract in Q2 and Q3. Cuts 2026 growth forecast to 0.5% from 1.0%. → A darkening outlook for Europe's largest economy. Bearish for the euro.

💡 Technical Analysis

Source: Investing.com – Prices as of Jun 11, 2026 03:01-03:02 AM (GMT-4:00)

USD/CAD – 1.3957

Resistance: 1.3961 (R1) / 1.3965 (R2) / 1.3974 (R3) → Clear R1 for more upside

Support: 1.3948 (S1) / 1.3939 (S2) / 1.3935 (S3) → Hold above S1 keeps upside potential

The Bank of Canada held rates but left the door open both ways. No clear catalyst for CAD strength. USD/CAD remains supported by broad dollar strength.

USD/JPY – 160.55

Resistance: 160.58 (R1) / 160.61 (R2) / 160.63 (R3) → Clear R1 for more upside

Support: 160.53 (S1) / 160.51 (S2) / 160.48 (S3) → Very tight range. A break below S1 would signal a shift.

Ueda's hospitalization adds uncertainty. The BOJ meeting next week will be led by the deputy governor. Markets will watch closely for any policy signal changes. The weak yen trend remains intact.

🔮 Looking Ahead

- 🇺🇸 Fed meeting – any shift in tone after CPI?

- 🇯🇵 BOJ meeting – Ueda's absence, any policy surprises?

- 🇩🇪 German economy – will the contraction materialize?

- 🇨🇦 BoC – will they tip their hand on next move?

- 🇷🇺 Russia rate decision – Putin's cut signal?