Forex Today: Market players on their toes ahead of US inflation data
|What you need to take care of on Wednesday, August 10:
The American currency extended its weekly decline throughout the first half of the day but managed to recover some ground during the US session. Nevertheless, volatility across financial markets was limited amid lingering US inflation figures.
Market players await the US Consumer Price Index, hoping prices pressure have started receding in July. Still, the core annual reading is foreseen advancing to 6.1% from the current 5.9% level. At the end of the day, speculative interest will rush to price in whatever they believe the Federal Reserve will do with the monetary policy. China and Germany will also publish inflation data ahead of the US figures.
The EUR/USD pair flirted with the 1.0250 level but shed some 50 pips ahead of the close. The shared currency was weighed by headlines indicating that Russia reportedly suspended oil flows via the southern leg of the Druzhba pipeline, amid transit payment issues.
The energy crisis affecting Europe has led to the UK government planning potential organised energy blackouts this winter for industry and households as a worst-case scenario. GBP/USD eased and trades at around 1.2060 ahead of the Asian opening.
Commodity-linked currencies turned red against the greenback by the end of the day, although losses are limited. AUD/USD trades around 0.6950 while USD/CAD hovers around 1.2890.
Gold was among the best performers, hitting an intraday high of $1,800.49 a troy ounce. It finished the day at $1,795. Crude oil prices were up at the beginning of the day but finished the day with modest gains. WTI trades at $90.70 a barrel.
Wall Street edged lower, following the lead of its European counterparts, although losses were moderated. US Treasury yields, on the other hand, ticked higher with that on the 10-year note, currently at 2.79%.
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