REAL ESTATE: DIGITAL REALTY (DLR: Baa2/BBB/BBB): Q4 & FY24

Looking through the details here we have services notably softer than expected at 4.37%Y/Y. Core goods and food/alcohol a little higher than expected (so less of a surprise in core / headline).

• Air fares are soft. Only rising 16.2%M/M in December - the expectations we had seen for that were around 40-45%M/M (remember this is NSA data). They alone contributed to headline CPI falling 0.14ppt and around double that for services CPI.
• Accommodation services also soft - contributing -0.07ppt to headline CPI.
• Cultural services -0.04ppt contribution.
• Other than that clothing and tobacco (both expected to contribute negatively).
• At first glance this doesn't look very broad-based at all and is largely the most volatile components contributing almost entirely to the downside in services / core / headline CPI.
• GBPUSD hit a low of 1.2163 but is around 20 pips higher at the time of writing.

• MNI: UK DEC CPI +0.3% M/M, +2.5% Y/Y

• RES 4: 165.43 High Nov 8 
• RES 3: 164.90 THigh Dec 30 and a key short-term resistance  
• RES 2: 164.55 High Jan 7
• RES 1: 163.19 High Jan 10 
• PRICE: 161.89 @ 07:04 GMT Jan 15 
• SUP 1: 160.04 Low Jan 13    
• SUP 2: 160.54 50.0% retracement of the Dec 3 - 30 bull cycle   
• SUP 3: 159.51 61.8% retracement of the Dec 3 - 30 bull cycle
• SUP 4: 158.67 Low Dec 11

The recent move down in EURJPY appears corrective. The recovery from Monday’s low highlights a potential short-term reversal and the end of the corrective cycle. A continuation higher would open 164.90, the Dec 30 high. Clearance of 164.90 would confirm a resumption of the uptrend. On the downside, key short-term support has been defined at 160.04, the Jan 13 low. A breach of this level would be a bearish development.