India’s infrastructure output rose by 4.6% year-on-year in January, exceeding the previous figure of 4%. Meanwhile, the US Department of Commerce reported a PCE inflation rate of 2.5% for January, with core PCE inflation slightly higher at 2.6%.

Following the release of PCE inflation data, EUR/USD managed to recover to around the 1.0400 region. Simultaneously, gold prices remained low at approximately $2,850 per ounce, as US yields showed a slight bearish trend.

The US labour market displayed resilience despite a slowdown in hiring in January. Additionally, President Trump confirmed that 25% tariffs on Canada and Mexico will take effect on March 4, along with a new 10% tariff on Chinese imports.

India’s infrastructure output posted a 4.6% rise in January compared to the same period last year, a slight improvement from December’s 4% expansion. This suggests that key industrial sectors, including energy and construction materials, are maintaining momentum despite broader global uncertainties. Healthy infrastructure growth often signals sustained domestic demand, which can influence commodities and raw material pricing in the medium term.

Over in the US, the Department of Commerce reported that personal consumption expenditures (PCE) inflation for January stood at 2.5%, with the core measure – which excludes volatile food and energy components – coming in slightly higher at 2.6%. These figures indicate that inflation remains moderate but persistent, reinforcing expectations that monetary policy will stay tight for longer than previously anticipated. This is particularly relevant for those navigating interest rate-sensitive assets, as market pricing of future rate decisions could shift in response.

Following the PCE data release, the euro made up some lost ground against the dollar, rising towards 1.0400. This suggests that traders reassessed the inflation figures in relation to Federal Reserve policy, temporarily boosting risk appetite in currency markets. Meanwhile, gold prices failed to attract demand, staying around $2,850 per ounce. The combination of steady inflation and slightly weaker US yields appears to have kept traders from aggressively buying into safe-haven assets.

The US labour market continues to demonstrate resilience, even as hiring slowed in January. A strong labour market can keep wage growth stable, potentially sustaining inflation at current levels. For those tracking employment data, sustained strength may delay rate cuts, particularly if upcoming reports reinforce this stability.

On the trade policy front, Donald Trump confirmed that 25% tariffs on imports from Canada and Mexico will take effect on 4th March. Additionally, a new 10% tariff on Chinese imports was announced. Market participants will need to assess how businesses respond to these measures, particularly in sectors reliant on global supply chains. With potential knock-on effects on currency valuations and corporate earnings, the fallout from these trade policies may well shape price action in the coming weeks.