Forex Today: Risk appetite takes its toll on the greenback

Valeria Bednarik FXStreet

What you need to know on Friday, September 24:

The market sentiment improved substantially, following news that Evergrande, the Chinese property giant, will likely be restructured to avoid default. Additionally, the local government is prepared to provide another kind of support, while a unit of the troubled company pledged to make an on-time interest payment.

The American dollar shed ground all the post-Fed ground and even fell further against most major rivals. HOWEVER, the EUR/USD pair held below its weekly high of 1.1755, as tepid European data spooked bulls.

The GBP/USD reached 1.3750 after a hawkish Bank of England announcement. The UK central bank left its monetary policy unchanged and the £895 billion facilities program on hold. The MPC voted 9-0 to leave rates on hold but voted 7-2 on reducing QE, while the statement noted that some developments strengthen the case for modest tightening. Still, policymakers said that uncertainties around the labor market remain but added that a rate hike would precede tapering.

The USD/JPY pair jumped to the 110.20 price zone, where it currently stands, amid a prevalent risk appetite. US Treasury yields soared to levels that were last seen in July, with the yield on the 10-year note hitting an intraday high of 1.411% and settling nearby. Wall Street rallied, with the DJIA adding over 550 points and the S&P adding roughly 1.4%.

Commodity-linked currencies were firmly up, following the lead of stocks. AUD/USD trades at around 0.7300, while USD/CAD is down to 1.2650.

Gold prices are sharply lower amid the upbeat mood, with the bright metal currently trading around $1,750 a troy ounce. Crude oil prices edged higher, with WTI settling at $73.10 a barrel.

Bitcoin bulls are going for the short squeeze and targeting $50,000 in the comeback

Like this article? Help us with some feedback by answering this survey:

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.

GBP/USD clings to recovery gains near 1.3550 after UK CPI data

GBP/USD holds recovery near 1.3550 in European trading hours on Wednesday. The UK annual Consumer Price Index (CPI) inflation picked up to 2.9% in July, meeting estimates, while core CPI rose by 2.6% YoY in July versus 2.5% expected. Mixed UK inflation data failed to provide any impetus to the British Pound.

EUR/USD advances to 1.1600 as USD slips ahead of Fed Minutes

EUR/USD stretches higher toward 1.1600 in Wednesday's European session. The US Dollar resumes its downside as weak US economic data weigh on expectations of tighter Federal Reserve policy. Traders will take further cues from ECB President Christine Lagarde’s speech and the FOMC Minutes later in the day.

Gold climbs back above $4,350 as USD remains depressed ahead of FOMC Minutes

Gold climbs back above $4,350 during the first half of the European session, reversing a part of the previous day's heavy losses. The US Dollar attracts some sellers, and for now seems to have stalled this week's goodish recovery from a two-month low, which is seen as a key factor supporting the commodity. Bulls, however, might opt to wait for more cues about the US Federal Reserve's future policy path before placing fresh directional bets on the non-yielding yellow metal.

Shiba Inu's recovery hinges on key support

Shiba Inu recovers slightly, trading at $0.0000044, after finding support around the critical level earlier this week. The dog-themed meme coin shows improving sentiment as social dominance rises, funding rates turn positive, and bullish traders increase their long positions. On the technical side, SHIB suggests a potential recovery if it holds above the key $0.0000043 level.

Inflation prints and FOMC Minutes take centre stage

In the US, the minutes from the FOMC's July meeting are released this evening. Markets are looking for a more detailed sense of the committee's thinking beyond Kevin Warsh's limited forward guidance. Three participants voted in favour of a hike, and since then, several others have flagged willingness to support a hike if warranted by incoming data.

Why is Crude Oil priced for a reopening the ships haven't made?

Fourteen vessels crossed the Strait of Hormuz on Tuesday. Before the war, the count ran near 120 a day. In the sessions since the waterway was publicly declared open, Brent has drifted back to $87 and West Texas Intermediate (WTI) to $81, both a little lower again on Wednesday, with daily momentum on each unwound from the top of its range in late July to the low twenties now.