Forex Today: Focus shifts to US CPI, while the ECB is seen “on hold”

Mounting speculation of further rate cuts by the Federal Reserve next week weighed down the US Dollar (USD) on Wednesday, a view reinforced after US Producer Prices rose less than expected in August.

Here's what to watch on Thursday, September 11:

The US Dollar Index (DXY) faded Tuesday’s mild recovery, hovering around the 97.60 region as investors digested the softer-than-estimated Producer Prices and got ready for Thursday’s more relevant CPI data. Indeed, the Inflation Rate will take centre stage seconded by the weekly Initial Jobless Claims.

EUR/USD regained some composure, reclaiming the 1.1700 barrier and beyond after bottoming out near 1.1680. The ECB is widely anticipated to maintain its interest rates unchanged for the second meeting in a row.

GBP/USD clocked decent gains, revisiting the 1.3560 zone following the Greenback’s knee-jerk. The RICS House Price Balance will be the only data release on the UK docket.

USD/JPY added to Tuesday’s decline, challenging once again its key contention zone around 147.00. Attention will be on the BSI Large Manufacturing index, Producer Prices, and weekly Foreign Bond Investment figures.

AUD/USD stepped on the gas and rose to levels last seen in early November 2024 past the 0.6630 level, further extending its monthly recovery. The Consumer Inflation Expectations and the speech by the RBA’s Connolly are due next in Oz.

Prices of WTI rose for the third consecutive day, trespassing the $64.00 mark per barrel amid geopolitical tensions and despite a bearish EIA’s report on US crude supplies.

Gold prices resumed their uptrend on Wednesday, retesting the $3,650 zone per troy ounce while rapidly leaving behind Tuesday’s knee-jerk. Silver prices followed suit, setting aside the previous day’s pullback and reclaiming the $41.00 mark per ounce.