EUR/USD
The EUR/USD pair extends the decline to near 1.1635 during the early European trading hours on Wednesday. The US Dollar (USD) strengthens against the Euro (EUR) as traders await the Federal Reserve’s (Fed) annual Jackson Hole symposium later on Friday for clues on the US interest rate path.
GBP/USD
GBP/USD eased lower on Tuesday, edging back below 1.3500 as Cable traders await a reason to make a move. The trading week opened up with little of note on the economic data docket, leaving markets to react to headline flows that remained constrained.
USD/JPY
The Japanese Yen (JPY) attracts some dip-buyers following the mixed domestic data-inspired downtick during the Asian session and turns positive for the second straight day. Investors now seem convinced that the Bank of Japan (BoJ) will stick to its policy normalization path and hike interest rates by the year-end. This, along with the cautious market mood, turns out to be a key factor acting as a tailwind for the safe-haven JPY. However, domestic political uncertainty and concerns about the potential economic fallout from higher US tariffs suggest that the prospects for BoJ rate hike could be delayed further.
AUD/USD
AUD/USD remains depressed close to three-week lows below 0.6450 in the Asian session on Wednesday as reduced bets for aggressive Fed rate cuts push the US Dollar higher. A cautious market mood and the PBOC’s status quo are also weighing on the Aussie amid the RBA’s dovish tilt. Traders now await the Fed Minutes.
NZD/USD
NZD/USD stays deep in the red toward 0.5800 as the RBNZ Governor Hawkesby heralds further easing after the central bank cut the OCR to 3% as expected. The RBNZ Monetary Policy Review (MPR) also signaled scope for further rate cuts, weighing heavily on the New Zealand Dollar (NZD).
USD/CAD
The USD/CAD pair posts modest gains near 1.3870 during the early Asian session on Wednesday. The Canadian Dollar (CAD) weakens against the US Dollar (USD) as cooler Canadian inflation data raised expectations that the Bank of Canada (BoC) would cut interest rates in the coming months.
USD/CHF
The USD/CHF pair tumbles to near 0.8070 during the early European session on TuesWednesday. However, the potential downside for the pair might be limited amid optimism of a truce in the conflict between Russia and Ukraine.
CRUDE OIL
Oil prices were little changed on Wednesday as investors await the next steps in talks to end Russia’s invasion of Ukraine, leaving in place sanctions on Russian crude and the chance of further restrictions on its buyers.
Gold is flirting with three-week lows near $3,300 in Wednesday’s Asian trading as the US Dollar clings to the previous upswing, bracing for the Federal Reserve Minutes later in the day and Friday’s speech by Chair Jerome Powell at the Jackson Hole Economic Symposium.
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