Forex Today: US Dollar selloff pauses ahead of confidence data

Eren Sengezer FXStreet

Here is what you need to know on Friday, July 14:

The US Dollar (USD) continued to weaken against its rivals throughout Thursday and in the Asian on Friday. After having touched its weakest level in 15 months at 99.57, however, the US Dollar Index (DXY) started to recover toward 100.00. Import/Export Price Index data will be featured in the US economic docket alongside the University of Michigan's (UoM) Consumer Sentiment Index. During the European trading hours, Eurostat will release Trade Balance data for May.

Following Wednesday soft consumer inflation data, the US Bureau of Labor Statistics reported on Thursday that the Producer Price Index (PPI) rose only 0.1% on a yearly basis in June. Wall Street's main indexes opened higher after this data and the 10-year US Treasury bond yield extended its slide, losing over 2% for the second straight day. In turn, the DXY turned south and broke below 100.00. Although Federal Reserve (Fed) policymakers delivered hawkish comments, the USD failed to show resilience. The DXY is down more than 2% this week and remains on track to register its largest one-week loss since November.

Earlier in the day, Australian Prime Minister Anthony Albanese and Treasurer Jim Chalmers called an emergency press conference to announce that Michele Bullock will be appointed as the Governor of the Reserve Bank of Australia (RBA) when Philip Lowe's term expires in September. This development had little to no impact on AUD/USD and the pair was last seen trading in negative territory below 0.6900.

EUR/USD climbed to its highest level in 16 months near 1.1250 in the Asian session on Friday before retreating to the 1.1200 area. The pair is up more than 200 pips this week.

GBP/USD touched its strongest level since April 2022 at 1.3146 but lost its bullish momentum heading into the European session. At the time of press, the pair was down 0.3% on the day, trading a few pips below 1.3100.

The data from Japan showed early Friday that Industrial Production contracted by 2.2% on a monthly basis in May. Capacity Utilization also declined 6.3% in the same period. After having slumped to its weakest level in a month below 137.50, USD/JPY reversed its direction and was last seen trading in postive territory at around 138.50.

Gold price struggled to capitalize on the broad USD weakness and registered small gains on Thursday. XAU/USD stays on the back foot early Friday and retreats toward $1,950. Following this week's sharp decline, the 10-year US Treasury bond yield is up nearly 1% on the day near 3.8% in the European morning, making it difficult for the pair to hold its ground.

Following a consolidation phase earlier in the week, Bitcoin rose above $31,000 on Thursday. BTC/USD stays relatively quiet at around $31,300 early Friday. Ethereum gathered bullish momentum and gained more than 7% on Thursday. ETH/USD was last seen moving sideways at around $2,000.

Author

Eren Sengezer

FXStreet

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.

AUD/USD bulls seem hesitant near 0.6950

AUD/USD attracts some buyers for the second straight day, though it remains confined within Friday's broader range amid mixed cues. The US PCE data and the US NFP report released last week tempered October Fed hike bets, dragging US bond yields away from multi-year highs and keeping US Dollar bulls on the back foot. However, geopolitical uncertainty is a tailwind for the safe-haven buck, while the RBA's cautious outlook caps the Aussie.

USD/JPY remains confined in a range below 158.00

USD/JPY holds steady around 157.75 during the Asian session on Monday, trading within a one-week-old range. Against the backdrop of soft US PCE data, the US NFP report, released on Friday, tempers October Fed rate-hike bets and drags US bond yields away from multi-year highs. Furthermore, hawkish BoJ expectations amid looming intervention risks support the Japanese Yen, capping the pair. However, geopolitical uncertainty acts as a tailwind for the safe-haven buck and limits the downside.

Gold trades with positive bias around $4,150; upside seems capped

Gold attracts some dip-buyers at the start of a new week, though it remains confined in a familiar range held over the past week or so. Against the backdrop of soft US PCE data, Friday's weak US NFP report tempered bets of an October Fed rate hike. This, in turn, drags US bond yields away from multi-year highs and benefits the non-yielding bullion. The US Dollar, however, draws support from geopolitical uncertainties and could act as a headwind for the precious metal.

Week ahead: Fed minutes in the spotlight amid bond market rout

The first full week of October and the final quarter of the year get underway with little fanfare in terms of the economic agenda. But far from being short on excitement, the coming week will test market nerves, as government bond yields continue to soar on growing worries that the energy crisis will only get worse, fuelling inflation.

CFTC Report: Speculators turn more defensive as Oil exposure falls

The week in one sentence: During the week leading up to September 29, long positions in crude oil were significantly reduced, while short positions in the Canadian Dollar went up. In addition, the positioning of the Australian Dollar and the Japanese Yen declined, while Coffee buying stood out against a more general background of defensiveness.

The Euro is near a one-year low: Inflation could trigger its rebound, not its fall

EUR/USD has fallen to its lowest level since May 2025. The pair hit 1.1312 on Wednesday and trades well below the January peak of 1.2082. The decline reflects a powerful combination of US Dollar strength, geopolitical uncertainty and renewed concerns about Europe's exposure to higher energy prices.