CPI data should push dollar higher

Макроэкономика 25.05.2015 Following positive core CPI data releases last Friday, the Fed is expected to start raising rates this year. The dollar index rose versus the major currencies of advanced economies by 0.8%. Fed chairperson Janet Yellen commented that the rate increase should begin sometime in 2H15 if an economic recovery from the weak 1Q materializes as expected. In our view, current market consensus is eyeing September's Fed rate meeting as the probable time to launch the rate increase. For the UAH, market pressure on the FX rate could start again because good news for the US economy normally causes volatility in emerging market economies, i.e. Ukraine.