The US dollar was soft leading into the September CPI report but abruptly reversed on the high readings. Inflation rose 0.4% in the month, double the 0.2% economists were expecting.
That led to a spike in the dollar across the board, including new multi-year extremes in USD/JPY, AUD/USD, USD/CAD, NZD/USD and others.
The Australian dollar chart is instructive because it also captures the rout in risk sentiment. S&P 500 futures were up 40 points ahead of the data and now are down by 73, a 113-point swing. The weekly chart of AUD/USD shows how it's cascading towards the pandemic lows.
For what it's worth, the euro is still holding the September lows and there's a bit of breathing room yet down to the 0.9536 low. The problem for other countries is that falling currencies will add to imported inflation, making the job of central banks harder.
