Forex Today: Markets will closely follow the PCE data and German inflation

The US Dollar traded with a tepid downside bias amid lower yields and further investors’ assessment of Wednesday’s hawkish hold by the Federal Reserve, while the release of Friday’s PCE also prompted some caution.

Here is what you need to know on Friday, January 31:

The US Dollar Index (DXY) remained inconclusive below the 108.00 mark and amid shrinking US yields. The publication of PCE figures will gather all the attention, seconded by Personal Income/Spending, the Chicago PMI, Employment Cost index and the speech by the Fed’s Bowman.

EUR/USD hovered around the low-1.0400s, up slightly, after the ECB lowered its key rates by 25 bps, as expected. Germany’s flash Inflation Rate takes centre stage, followed by the jobs report and Retail Sales. In addition, the ECB will release its Survey of Professional Forecasters (SPF).

GBP/USD added to Wednesday’s uptick and advanced modestly, briefly revisiting the 1.2480 zone. The Nationwide Housing Prices will be the only release across the Channel.

USD/JPY dropped markedly to three-day lows in the sub-154.00 region, adding to the previous day’s pullback. Japan’s Unemployment Rate, Industrial Production, Retail Sales, Housing Starts, Construction Orders, and Tokyo Inflation Rate are expected at the end of the week.

AUD/USD managed well to regain balance and set aside three consecutive daily pullbacks, retesting the 0.6250 zone. Producer Prices, Housing Credit figures and Private Sector Credit results are all due in Oz.

WTI oil dropped further and challenged the $72.00 mark per barrel, or four-week lows, on the back of steady concerns surrounding the US tariffs narrative.

Gold prices regained the uptrend and advanced to a record high just below the key $2,800 mark per ounce troy. Silver prices rallied past the $31.00 mark per ounce for the first time since early December.