Forex Today: Optimism returns as recession fears dilute

Valeria Bednarik FXStreet

What you need to take care of on Friday, August 16:

The US Dollar seesawed between gains and losses, ending the day mixed across the FX board after United States (US) data brought relief. Speculative interest dropped concerns about a potential recession in the world’s largest economy following the release of healthy employment-related figures and upbeat Retail Sales. Other figures were not that encouraging but fell short of reviving concerns or affecting the odds for a September interest rate cut.

Stocks made the most out of it, as Wall Street extended its rally to fresh weekly highs, with the three major indexes holding on to substantial gains at the end of the day.

The Euro lost the 1.1000 mark versus the US Dollar and settled around 1.0970, while GBP/USD managed to end the day at around 1.2860, as Sterling Pound found support in local data. The UK Q2 Gross Domestic Product (GDP) showed the economy grew 0.6% in the three months to June as expected. Additionally, Manufacturing Production rose 1.1% MoM in June, surpassing expectations.

Safe-haven CHF and JPY edged lower vs the US Dollar, but commodity-linked currencies such as the AUD and the CAD held within familiar levels as stocks’ rally partially offset USD strength.

Gold managed to trim intraday losses and recovered the $2,450 mark ahead of the US close.

Friday will bring speeches from major central bank Governors. Reserve Bank of Australia (RBA) Michele Bullock is due to testify before Congress alongside other policymakers, while Reserve Bank of New Zealand (RBNZ) Adrian Orr is due to speak about monetary policy at an event hosted by the Wellington Chamber of Commerce.

Later in the day, the United Kingdom (UK) will release July Retail Sales, while the United States (US) will publish the preliminary estimate of the August Michigan Consumer Sentiment Index and the Michigan Consumer Inflation Expectations for the same month.

US Dollar PRICE Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.

	USD	EUR	GBP	JPY	CAD	AUD	NZD	CHF
USD		0.31%	-0.26%	1.13%	0.07%	-0.21%	0.25%	0.71%
EUR	-0.31%		-0.58%	0.80%	-0.25%	-0.61%	-0.23%	0.40%
GBP	0.26%	0.58%		1.40%	0.34%	-0.03%	0.36%	1.08%
JPY	-1.13%	-0.80%	-1.40%		-1.07%	-1.35%	-1.02%	-0.32%
CAD	-0.07%	0.25%	-0.34%	1.07%		-0.28%	0.02%	0.74%
AUD	0.21%	0.61%	0.03%	1.35%	0.28%		0.37%	1.09%
NZD	-0.25%	0.23%	-0.36%	1.02%	-0.02%	-0.37%		0.72%
CHF	-0.71%	-0.40%	-1.08%	0.32%	-0.74%	-1.09%	-0.72%

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 US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

AUD/USD stabilizes near 0.7100 as the post-Fed USD rally pauses

AUD/USD consolidates the previous day's losses near 0.7100 in the Asian session on Thursday as the US Dollar pauses its hawkish Fed-inspired rally to its highest level since late July. However, RBA rate-hike bets and hopes for US-Iran diplomatic efforts lift risk sentiment and support the risk-sensitive Australian Dollar and the major.

USD/JPY reverses a dip below 156.00 as focus shifts to BoJ

USD/JPY is reversing a brief dip below 156.00 in the Asian session on Thursday, looking to snap a three-day winning streak to a nearly two-week top set the previous day. The US Dollar pauses following the post-Fed rally to seven-week highs, while a more hawkish repricing of the BoJ's policy normalization path supports the Japanese Yen. This keeps the pair's upside limited, with the focus now shifting to the BoJ policy decision due on Friday.

Gold flirts with $4,300 on the post-Fed road to recovery

Gold flirts with the $4,300 level in the Asian session on Thursday, reversing much of the previous day's losses to a six-week low as the US Dollar eases from its highest level since late July. Meanwhile, oil-driven inflation fears ease amid hopes of US-Iran diplomacy, weighing on US Treasury yields while lifting yieldless Gold.

What happens to Ethereum price now that the Clarity Act has failed

Ethereum and the wider crypto market felt the impact of the Clarity Act failing to clear the Senate. Analysts had touted the bill as a major tailwind for the second-largest cryptocurrency. Expectations that its advance would trigger a rally have now been reset. The setback has left its mark on ETH.

The Fed rate hike: What happens now?

The dust has settled on tonight’s Fed meeting and the market reaction is clear: the Fed’s signal that there could be a series of rate hikes has spooked financial markets. Bonds sold off at the short end of the Treasury curve and US stocks also fell, led by the Dow Jones Industrial Average, which slipped more than 1% on Wednesday night.

How Japan became the World's Banker and why that era may be ending

Japan's ultra-low interest rates helped finance trillions of dollars in global investments for more than a decade, making the Japanese Yen one of the world’s cheapest sources of funding. With the Bank of Japan expected to tighten policy again this week, that advantage may be entering a new phase. While most major economies raised interest rates, Japan remained the world's outlier.