EUR/USD: ECB to reinforce euro weakness if delivers another 50 bps hike – MUFG

FXStreet Insights Team FXStreet

The next key event for the euro in the week ahead will be the European Central Bank’s (ECB) upcoming policy meeting on Thursday. Economists at MUFG Bank note that the balance of risks for the euro appear more tilted to the downside.

ECB set to deliver a 75 bps hike

“We are still sticking to our view that the ECB will deliver a 75 bps hike. If the ECB disappoints market expectations and delivers another 50 bps hike it could reinforce euro weakness in the near-term.”

“The balance of risks for the euro appear more tilted to the downside from the policy update given the eurozone rate market is already repricing in a more aggressive rate hike profile and it has failed to provide much support for the euro.”

Author

FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

GBP/USD weakens below 1.3450 as US-Iran uncertainty boosts safe-haven US Dollar

The GBP/USD pair loses ground to near 1.3425 during the early Asian session on Tuesday. Uncertainty surrounding US-Iran talks drives traders toward a safe-haven currency such as the US Dollar against the British Pound. All eyes will be on the US July jobs data, which is due later on Friday.

EUR/USD flatlines above 1.1500 as traders turn cautious ahead of US NFP data

The EUR/USD pair holds steady around 1.1505 during the early European trading hours. Markets remain cautious ahead of the crucial US July jobs report, which is due later this week. Eurozone inflation ticked up in July, bolstering the case for a rate hike from the European Central Bank. The headline Eurozone inflation rose to 2.9% YoY in July from 2.8% in June, in line with expectations.

Gold consolidates above $4,050 amid Fed hike bets and Iran uncertainty

Gold seesaws between tepid gains and minor losses during the Asian session as traders seem hesitant and opt to wait for further developments surrounding the Middle East crisis. The US Dollar struggles to build on the previous day's solid bounce from the lowest level since Mid-June and acts as a tailwind for the bullion. However, the uncertainty over US-Iran peace talks helps limit the downside for the buck.

Ripple and Stellar steady as derivatives data points to easing downside pressure

Ripple and Stellar show mixed price action, with XRP holding above the key $1 support zone while XLM faces rejection at $0.173. Meanwhile, improving derivatives metrics alongside fading bearish momentum suggest that the downside pressure may be easing for both altcoins. Derivatives data shows mild bullish sentiment among traders.

NFP week: What awaits Bitcoin and Gold

This is an NFP week as markets brace for the release of a large influx of job market statistics. The data rollout begins with the JOLTS Job Openings report on Tuesday, continues with the ADP Employment report on Wednesday and Jobless claims on Thursday, and finishes with the Nonfarm Payrolls report on Friday.

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.