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Forex Today: Mid-tier US data and Chairman Powell's comments could ramp up volatility

Here is what you need to know on Thursday, November 9:

The US Dollar (USD) lost its strength following the bullish action seen earlier in the week, with the USD Index closing the day virtually unchanged on Wednesday. Markets stay relatively quiet early Thursday as focus shifts to weekly Initial Jobless Claims data from the US. Later in the American session, Federal Reserve (Fed) Chairman Jerome Powell will participate at an International Monetary Fund (IMF) panel titled 'Monetary policy challenges in a global economy.' European Central Bank (ECB) President Christine Lagarde is also scheduled to deliver a speech.

The benchmark 10-year US Treasury bond yield fell more than 1.5% on Wednesday and caused the USD to weaken against its major rivals. Meanwhile, Wall Street's main indexes ended the day virtually unchanged.  In the European morning, US stock index futures trade mixed.

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 strongest against the Australian Dollar.

 USDEURGBPCADAUDJPYNZDCHF
USD 0.21%0.72%0.92%1.50%0.93%1.03%0.05%
EUR-0.22% 0.51%0.71%1.29%0.71%0.81%-0.17%
GBP-0.72%-0.52% 0.20%0.78%0.20%0.31%-0.68%
CAD-0.93%-0.71%-0.20% 0.58%0.00%0.11%-0.88%
AUD-1.53%-1.31%-0.80%-0.59% -0.58%-0.49%-1.48%
JPY-0.94%-0.72%-0.43%0.01%0.59% 0.10%-0.89%
NZD-1.04%-0.83%-0.31%-0.11%0.48%-0.11% -0.99%
CHF-0.05%0.17%0.67%0.87%1.45%0.88%0.98% 

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).

Following Wednesday's indecisive action, EUR/USD seems to have stabilized slightly above 1.0700 early Thursday. The data from the Euro area showed on Wednesday that Retail Sales contracted by 2.9% on a yearly basis in September.

GBP/USD staged a rebound in the second half of the day and erased its daily losses to close flat slightly below 1.2300 on Wednesday. In the European session on Thursday, the pair moves sideways near 1.2300.

In the minutes of the October policy meeting, the Bank of Canada noted that some members felt that it was more likely than not that the policy rate would need to increase further to return inflation to target. The Canadian Dollar, however, failed to benefit from this hawkish statement and continued to weaken amid falling crude oil prices. The barrel of West Texas Intermediate (WTI) fell 2% mid-week and declined to its lowest level since July below $76. USD/CAD closed the third consecutive day in positive territory on Wednesday before going into a consolidation phase slightly below 1.3800 on Thursday.

USD/JPY preserved its bullish momentum and registered gains on Wednesday. The pair stays relatively quiet at around 151.00 early Thursday. The Bank of Japan repeated in the Summary of Opinions that they will "continue with the framework of yield curve control and the negative interest rate policy, at least as long as it is necessary for maintaining the price stability target of 2% in a stable manner."

Gold's downward correction picked up steam on Wednesday, with XAU/USD slumping to its weakest level in nearly three weeks at $1,947. In the European morning, the pair consolidates its weekly losses at around $1,950.

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.

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