Forex Today: The ECB and Lagarde steal the show

Pablo Piovano FXStreet

The Greenback extended its downtrend to new four-month lows in response to another FX intervention by the BoJ, firmer rate-cut bets, and the broad-based better tone in risk-associated assets. On Thursday, the ECB will most likely maintain its policy rates unchanged, while investors are expected to closely follow President Lagarde for any clues on the next rate cut.

Here is what you need to know on Thursday, July 18:

Further weakness sent the USD Index (DXY) to the sub-104.00 region, or four-month lows, helped by the lack of traction in US yields. The usual weekly Initial Jobless Claims and the Philly Fed Manufacturing Index are due on July 18 seconded by the CB Leading Index and Net Long Term TIC Flows. In addition, the Fed’s Logan is also expected to speak.

EUR/USD rose to multi-week highs around 1.0950 in response to the increased selling pressure in the Dollar. On July 18, the ECB should leave its interest rates unchanged, while attention will also be on the press conference by President Lagarde.

GBP/USD finally surpassed the 1.3000 barrier for the first time since July 2023. The publication of the UK labour market report should take centre stage in the domestic docket on July 18.

USD/JPY dropped further in response to another suspected intervention in the FX space by the BoJ. The Balance of Trade and weekly Foreign Bond Investment figures will be unveiled on July 18.

AUD/USD clinched its third daily pullback in a row amidst further weakness in the commodity universe and Chinese demand concerns. The always-relevant Australian labour market report will be at the centre of the debate on July 18.

A weaker Dollar, reignited geopolitical jitters, and the larger-than-expected weekly drop in US crude oil inventories all lifted WTI prices to three-day peaks near the $83.00 mark per barrel.

Gold prices rose to an all-time top near $2,490 per ounce troy before correcting a tad lower towards the end of the session. Silver sold-off and challenged the $30.00 mark per ounce, or two-week lows.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

Editor's Picks

EUR/USD drops to daily lows near 1.1630

EUR/USD now loses some traction and slips back to the area of daily lows around 1.1630 on the back of a mild bounce in the US Dollar. Fresh US data, including the September PCE inflation numbers and the latest read on December consumer sentiment, didn’t really move the needle, so the pair is still on course to finish the week with a respectable gain.

GBP/USD trims gains, recedes toward 1.3320

GBP/USD is struggling to keep its daily advance, coming under fresh pressure and retreating to the 1.3320 zone following a mild bullish attempt in the Greenback. Even though US consumer sentiment surprised to the upside, the US Dollar isn’t getting much love, as traders are far more interested in what the Fed will say next week.

Gold makes a U-turn, back to $4,200

Gold is now losing the grip and receding to the key $4,200 region per troy ounce following some signs of life in the Greenback and a marked bounce in US Treasury yields across the board. The positive outlook for the precious metal, however, remains underpinned by steady bets for extra easing by the Fed.