The USD moved higher after stronger PPI data.

Producer prices came in hotter than expected, reinforcing the recent shift toward a more inflation-conscious narrative. Headline PPI rose 0.7% MoM versus 0.3% expected, while the year-over-year rate accelerated to 3.4% (vs 2.9% expected). Core measures told a similar story, with PPI ex-food and energy up 0.5% MoM (vs 0.3% expected) and the annual rate at 3.9%, well above expectations. Even the narrower ex-food, energy, and trade measure showed firmness, pointing to underlying price pressures that are not easing as quickly as hoped.

The stronger-than-expected inflation data has helped lift the USD, with Treasury yields ticking higher as markets reassess the timing and pace of potential Fed rate cuts. Equities, meanwhile, have edged lower, reflecting concerns that persistent inflation could keep policy restrictive for longer.

Looking at the EURUSD, the price has rotated lower, moving away from the swing resistance area between 1.1543 and 1.1555, as well as the 200-hour moving average at 1.1543. The pair has since pushed down to a new low on the day at 1.1518. Despite the move, the overall trading range remains relatively narrow at just 38 pips, well below the 79-pip average over the past month, highlighting the market’s current lack of conviction. On the downside, the next key target comes in at the 100-hour moving average near 1.1497, which will be a critical level for traders looking to gauge whether sellers can build further momentum.

The USDJPY is pushing higher, moving back above its flattening 100-hour moving average at 159.19, with the high extending to 159.28. For buyers, the ideal scenario now is to hold support against that moving average—staying above keeps the short-term bias tilted to the upside. If momentum continues, traders will look toward the 159.45 area, a key level that served as the prior high for the year back in January. Price action over the past week has seen the pair trade above and below that level, reinforcing its importance. A sustained move back above 159.45 would strengthen the bullish case and signal a potential extension higher.

The USDCAD is trading modestly higher but remains stuck in a choppy, back-and-forth range ahead of the Bank of Canada rate decision at 9:45 AM ET. The rising 100-hour moving average, now at 1.3680, had been catching up to the price, but stronger PPI data has helped push the pair back above that level, with the current price near 1.3705.

For sellers to gain control, the price would need to break and stay below the 100-hour MA, which would shift the short-term bias to the downside. A move below that level targets the 38.2% retracement of last week’s rally at 1.3658, followed by the 50% midpoint and the 200-hour moving average near 1.3633.

On the topside, resistance remains firm in the 1.3714–1.3724 swing area. A sustained move above that zone would give buyers more confidence and tilt the bias more clearly to the upside.

The GBPUSD has run lower and to the downside target at the 100 hour MA at 1.33137. The low just reached 1.33131. Traders have leaned on the first test and is trading at 1.1323 currently. However, a move below the level would be more bearish and have the trading bias to even more in favor of the sellers.

The 10 year yield is now up 1.2 basis points at 4.212%. The 2-year yield is up 4.1 basis points at 3.711%.

Looking at the premarket for US stocks, the futures are implying: