FX Today: US jobs data and German flash CPI come to the fore

Pablo Piovano FXStreet

Fresh concerns surrounding a potential US government shutdown coupled with Fed rate cut expectation weighed on the US Dollar (USD) on Monday in a week where the US labour market is seen taking centre stage.

Here’s what to watch on Tuesday, September 30:

The US Dollar Index (DXY) added to Friday’s pullback and flirted with the area of three-day lows near 97.80 against the backdrop of further loss of momentum in US yields. The JOLTs Job Openings takes centre stage, alongside the FHFA’s House Price Index, the Chicago PMI, the CB Consumer Confidence, and the API’s weekly report on US crude oil inventories. In addition, the Fed’s Bostic, Jefferson and Goolsbee are due to speak.

EUR/USD managed to extend Friday’s recovery and revisit the 1.1750 zone amid the broad-based selling impulse on the Greenback. The Consumer Inflation Expectations in the euro area are due, followed by speeches by the ECB’s Cipollone, Kazaks, Muller, Lane, Machado, and Schnabel.

GBP/USD has started the week on a firm foot, advancing to the 1.3460 zone just to lose some momentum afterwards. The UK Current Account results will be published along with quarterly Business Investment figures and the final Q2 GDP Growth Rate. Additionally, the BoE’s Lombardelli, Ramsden, Mann and Breeden are due to speak.

USD/JPY faced extra downside pressure on Monday, slipping back to three-day lows near the 148.50 zone, an area also coincident with its 200-day SMA. The BoJ Summary of Opinions is due, followed by Retail Sales, flash Industrial Production, Housing Starts and Construction Orders.

AUD/USD rose sharply and approached the 0.6580, or two-day highs, ahead of the RBA meeting. The RBA is widely expected to leave its OCR unchanged, while Building Permits, Housing Credit, and Private House Approvals are also due.

Prices of the American WTI fell to three-day lows, returning to the area below the $64.00 mark per barrel on the back of the resumption of oversupply concerns.

Gold prices advanced to a record high around the $3,830 mark per troy ounce amid expectations of Fed rate cuts and fresh concerns over a potential US shutdown. By the same token, prices of the ounce of Silver rose past the $47.00 level per ounce for the first time since early May 2011.

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.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

RBNZ set to pause interest-rate easing cycle as new Governor Breman faces firm inflation

The Reserve Bank of New Zealand remains on track to maintain the Official Cash Rate at 2.25% after concluding its first monetary policy meeting of this year on Wednesday.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.