|

Forex Today: Focus shifts to US PCE, ADP, inflation in OZ and Chinese PMIs

The US Dollar (USD) has accelerated its recovery, adding to the positive start to the week and clinching new multi-week tops, always helped by the persistent advance in US Treasury yields and unabated geopolitical concerns.

Here is what you need to know on Wednesday, September 30:

The US Dollar Index (DXY) has approached the 101.60 zone for the first time since late July, as investors continued to assess the lack of progress in the Middle East conflict and the ongoing rise in US Treasury yields across the curve. The usual MBA Mortgage Applications are due, seconded by the ADP Employment Change, PCE, Personal Income/Spending, the Chicago PMI, the final Q2 GDP Growth Rate and the EIA’s weekly report on crude oil stockpiles. In addition, the Fed’s Goolsbee and Barkin will also speak.

EUR/USD has declined to three-month lows, coming just pips away from the key 1.1300 support level amid the firmer bias in the US Dollar and persistent geopolitical jitters from the US-Iran conflict. Germany will be in focus tomorrow with the release of Retail Sales, the labour market report and the preliminary Inflation Rate. Additionally, the ECB’s Schnabel is due to speak.

GBP/USD has followed the sentiment surrounding the rest of its risk-linked peers, challenging the 1.3200 region, or fresh three-month lows. Next on tap on the UK docket will be the Q2 Current Account results, Nationwide Housing Prices, quarterly Business Investment figures and the final Q2 Growth Rate. 

USD/JPY has traded with a modest upside bias, adding to Monday’s gains near 157.50 following the improvement in the Greenback and US yields. The flash Industrial Production prints are due on September 30 alongside Retail Sales, Housing Starts and Construction Orders.

AUD/USD has come under fresh and quite marked downside pressure on Tuesday, breaching below the critical 0.7000 yardstick while reversing two daily advances in a row. The key Inflation Rate is due on September 30, seconded by flash Building Permits, Private House Approvals and Private Sector/Housing Credit figures.

Front-month WTI futures have lost further ground, putting the key $90.00 mark per barrel to the test amid the third consecutive daily drop, always amid the resurgence of geopolitical tensions in the US-Iran-Hormuz conflict.

Gold has managed to partially regain ground lost at the beginning of the week, although another test of the $4,200 mark per troy ounce has remained elusive. The better tone in the US Dollar and the strong rebound in US Treasury yields across the curve have continued to weigh on the precious metal.


Author

Pablo Piovano

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

More from Pablo Piovano
Share:

Editor's Picks

AUD/USD hits nine-week lows below 0.7000 on RBA Bullock's remarks

AUD/USD reverses a brief uptick and turns lower to hit nine-week lows below 0.7000 in the European morning on Tuesday, as traders digest cautious remarks from Reserve Bank of Australia (RBA) Governor Michele Bullock during the press conference. Earlier on, the RBA raised the cash rate to 4.60%, as widely expected, leaving the door open to further rate hikes if needed.

USD/JPY consolidates near 157.50 as a bullish USD counters intervention risks

USD/JPY struggles to capitalize on the overnight bounce from a one-week low, consolidating around 157.50 in the Asian session on Tuesday. Trump's concerns about the Japanese Yen's weakness fueled speculation about another US-Japan joint intervention. This, along with the hawkish BoJ, underpins the JPY and caps the currency pair. Meanwhile, rising Fed rate-hike bets and oil-driven inflation fears continue to push US bond yields to multi-year highs, keeping the US Dollar pinned near a two-month high and supporting the pair.

Gold trims gains; back toward $4,150

Gold now surrenders some of its initial advance and retests the $4,150 zone per troy ounce on Tuesday. Meanwhile, the move higher in the yellow metal comes despite the firmer US Dollar and rising US Treasury yields across the board, while escalating geopolitical tensions appear to limit the downside potential.

Crypto Today: Bitcoin, Ethereum, XRP correct upward amid declining ETF inflows

The cryptocurrency market upholds a neutral-to-bullish bias on Tuesday, with Bitcoin edging closer to a breakout above $84,000. Altcoins mirror BTC’s outlook, with Ethereum holding above $2,700 and Ripple pushing past the reclaimed $1.50 level.

RBA recap: Rate hikes are on the table as demand stays too strong

The Reserve Bank of Australia unanimously tightened monetary policy, warning that inflation remained too high and that several upside risks had begun to materialise. Governor Michele Bullock said the Board would raise rates again if necessary.

Silver is more volatile than Gold ahead of PCE and NFP. This chart shows the positioning gap
The market’s attention is focused on American data this week, but there’s something only those with a trained eye may be looking at: Gold and Silver positioning gap. Financial markets are moving on fears, mostly related to persistently high energy prices driven by the Middle East war. Sure, the US Dollar (USD) is strong, but at what cost?