The united states dollar Index or it is also known as DXY yesterday failed to break through the 104.00 threshold. Then it was slammed after the latest comments from Fed Chairman Jerome Powell. 

The position has retreated to the range of 103.28 as of the end of the Asian session on Wednesday (8/February). In line with that, the greenback showed mixed performance in major currency pairs.

A QnA session was done before the Economic Club event in Washington yesterday. At that time Powell acknowledged that interest rates have to rise higher than expectations.

It is especially if the US economic conditions remain strong. However, he reiterated that the process of disinflation has already begun in the market.

Economist will Try to Push Inflation this Year

The process of disinflation, the process of lowering inflation, has begun, and it started in the goods sector, which covers about a quarter of our economy. This was stated by Powell lately.

However, he thought that it is still quite far away. This is only the very early stage. The analysts expect 2023 to be a year of significant decline in inflation. It's actually their job to make sure that happens. 

His guess is that the disinflation process is not just this year, but it will take until next year for inflation to fall close to 2%. According to Powell, his party will continue to make decisions based on the actual data. 

He did not specify a specific timeline for when the rate hike cycle would take place in order to achieve the inflation target. The reality is they are going to react to the data.

US Treasury and USD Rally Slackened 

That is why; if they continue to get, for example, a strong labor market report or a higher inflation report, it's possible they should act more. It is also impossible to raise interest rates more than previously thought.

All of that is not new news, but merely a reaffirmation of what Powell has expressed in previous public communications. As a result, the rally in US Treasury and US dollar yields both slackened.

Those were happened while waiting for the next catalyst. "Powell didn't say anything completely new. Powell thought that his party was pretty used to the idea that the Fed's decision is now definitely depend on data 

That was said by Chris Weston, a Pepperstone's head of research, Markets and central banks are now in a position where they only observe data.

Some News Will Be Released Next Week

The condition above makes them are now less sensitive to (rhetoric) Fed officials and much more sensitive to data. The scheduled release of economic data from Uncle Sam's country is likely to have a low-medium impact this week. 

Some big news will only be published next week. Those are the consumer inflation data, retail sales , and producer inflation data.

Meanwhile, Oil prices fell slightly in Asian trading on Wednesday (08/February). At the time when this news was writing, Brent oil was down by 0.30 percent at $83.81 a barrel.

It as was WTI crude which was down 0.17 percent at $77.35 a barrel. This decrease is the profit-taking impact of the increase that was previously formed due to several factors.

Earthquake in Turkey Brought some Effects 

Since the beginning of the week, oil prices have been bullish due to the prospect of rising Chinese demand. Prices then increased after the news of a devastating earthquake that hit Turkey. 

The reason is that the magnitude 7.8 earthquake also damaged a number of vital facilities including a port that is a terminal for Turkey's main exports.

The closure of export terminals in Turkey hampered oil shipments by as much as 1 million barrels per day (bph). This means that the world's crude oil supply will be tighter amid expectations of rising demand from large consumers such as China.