|

Forex Today: Markets quiet down ahead of US GDP revisions

Here is what you need to know on Thursday, December 21:

Major currency pairs stay relatively calm early Thursday as investors wait for the US Bureau of Economic Analysis to publish final revisions to the third-quarter Gross Domestic Product (GDP) data. The US economic calendar will also offer weekly Jobless Claims and Federal Reserve Bank of Philadelphia's Manufacturing Survey for December.

After edging lower in the first half of the day on Wednesday, the US Dollar (USD) Index staged a late rebound to close the day with marginal gains. The negative shift seen in risk sentiment, as reflected by the bearish action in Wall Street's main indexes, helped the USD find demand in the American session. Additionally, upbeat consumer sentiment and housing data supported the currency. Early Thursday, the USD Index seems to have gone into a consolidation phase below 102.50. US stock index futures trade in positive territory in the European morning, while the benchmark 10-year US Treasury bond yield recovers toward 3.9%. The US' annualized GDP growth is expected to be confirmed at 5.2% in Q3.

US Dollar price this week

The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the weakest against the Swiss Franc.

 USDEURGBPCADAUDJPYNZDCHF
USD -0.46%0.28%-0.16%-0.68%0.56%-0.54%-0.97%
EUR0.46% 0.74%0.31%-0.21%1.02%-0.07%-0.50%
GBP-0.28%-0.74% -0.44%-0.96%0.28%-0.83%-1.26%
CAD0.16%-0.31%0.43% -0.53%0.71%-0.39%-0.82%
AUD0.67%0.22%0.96%0.53% 1.23%0.14%-0.29%
JPY-0.56%-1.02%-0.26%-0.70%-1.26% -1.09%-1.55%
NZD0.53%0.07%0.82%0.39%-0.14%1.09% -0.43%
CHF0.95%0.49%1.23%0.80%0.28%1.52%0.42% 

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).

EUR/USD turned south and registered losses on Wednesday after closing the first two trading days of the week in the green. Early Thursday, the pair fluctuates in a tight channel at around 1.0950.

Following the sharp decline seen after softer-than-forecast inflation data from the UK, GBP/USD stabilized slightly below 1.2650 on Thursday. On Friday, the UK's Office for National Statistics will release Retail Sales and third-quarter GDP data.

USD/JPY edged lower on Wednesday after posting strong gains following the Bank of Japan (BoJ) policy announcements earlier in the week but managed to find a foothold near 143.00 on Thursday. The National Consumer Price Index data and the minutes of the BoJ's December policy meeting will be looked upon for fresh impetus in the early trading hours of Friday.

After dropping to a fresh multi-month low near 1.3300, USD/CAD regained its traction and closed in positive territory on Wednesday. The pullback seen in crude oil prices made it difficult for the commodity-sensitive Loonie to continue to outperform the USD. Statistics Canada will release October Retail Sales data later in the day.

Gold price turned south and declined to the $2,030 area on Wednesday. Falling US Treasury bond yields, however, allowed XAU/USD to limit its losses. Early Thursday, the pair moves up and down in a narrow band below $2,040.

Author

Eren Sengezer

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

More from Eren Sengezer
Share:

Editor's Picks

AUD/USD keeps the red near 0.6950 after weak Aussie jobs data

AUD/USD holds losses near 0.6950 on disappointing Australian jobs data, extending the previous day's retracement slide from the monthly high and hitting a fresh weekly low during Thursday’s Asian session. Meanwhile, declining US bond yields drag the US Dollar away from the April 2025 high, touched after Wednesday's hot US CPI, helping limit losses for the currency pair.

USD/JPY slides back below 158.00 as USD reverses post-CPI gains

USD/JPY extends the previous day's pullback from a three-week high, attracting follow-through selling and sliding below 158.00 during Thursday's Asian session. Traders remain on high alert amid speculation that authorities will step in to prop up the Japanese Yen. The US Dollar, meanwhile, reverses Wednesday's hot CPI-led gains to April 2025 highs as US bond yields retreat on China bond-buying talk, further pressuring the pair.

Gold rebounds to $4,150 as China bond-buying reports smash US yields

Gold attracts strong buying and retests $4,150 during the Asian session on Thursday, snapping a three-day losing streak to a one-week low. Retreating US bond yields drag the US Dollar away from the April 2025 high, touched in reaction to Wednesday’s hot US CPI report, and boost the non-yielding bullion. Reports that China is quietly buying US Treasuries through Canada are smashing US Treasury bond yields and the USD.

Bitcoin falls on hot CPI: Why $80,000 support matters

Bitcoin's (BTC) most critical level to watch is near $80,000 as September's hot inflation reading pressures the crypto market, according to Glassnode. The top crypto declined within minutes of the September Consumer Price Index (CPI) release, which showed a 3.7% annual increase in headline inflation, above forecasts of 3.6%. Core inflation, which excludes food and energy prices, came in at 2.6%.

China seems routing US Treasury holdings through Canada

According to a Bloomberg report, China seems to be moving United States securities to non-US custodian banks in other countries, masking its role in financing US deficits.

Has Bitcoin really escaped the macro forces it was built to fight?
Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?