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10.08.2022 Market Report


EUR/USD picks up bids to reverse early Asian session losses, stays mildly bid around weekly top. DXY tracks sluggish yields even as Fedspeak favors 75 bps rate hike in September. Final readings of Germany’s HICP inflation for July can entertain traders ahead of US CPI.


GBP/USD is juggling in six-pips as investors are expected to create positions post US Inflation data. For Fed’s neutral stance, a spree of a slowdown in price pressures is required. The UK’s GDP is expected to remain vulnerable ahead.


The USD/JPY pair has witnessed mild selling pressure after printing an intraday high of 135.24 in the Asian session. The asset is walking northwards briskly to recapture its two-week high at 135.58. However, a slower upside move signals exhaustion and could trigger downside momentum at any time.


AUD/USD holds lower ground near 0.6960 during Wednesday’s Asian session, justifying the downbeat inflation data from China. In addition to China CPI and PPI data, cautious mood ahead of the US inflation numbers and fears of economic recession also weigh on the Aussie pair.


The NZD/USD pair is advancing sharply towards 0.6300 after the National Bureau of Statistics of China reported a higher Consumer Price Index (CPI) at 2.7% than the prior release of 2.5%. However, the annual cost pressures remained lower than the expectation of 2.7%. The monthly data remains in line with the estimates of 0.5%.


USD/CAD steps back from the intraday high of 1.2895 as bulls and bears jostle amid mixed catalysts and the market’s anxiety before important US data on Wednesday. Even so, softer prices of Canada’s main export item, WTI crude oil, join the recently firmer US Dollar Index (DXY) to keep buyers hopeful.


USD/CHF treads water around 0.9560, despite picking up bids ahead of Wednesday’s European session, as markets remain quiet amid a cautious mood before the US inflation data release.


Crude oil prices shot to a multi-day high in reaction to the news that Ukraine has suspended Russian oil pipeline flows to parts of central Europe since early this month. This, in turn, offered some support to the commodity-linked loonie and acted as a headwind for the major amid a modest US dollar weakness.


Gold price tested the $1,800 mark for the first time in over a month on Tuesday, having shrugged off resurgent demand for the US dollar even as the Treasury yields jumped across the curve. XAU/USD eyes a softer US CPI print for a big break above the $1,800 mark.

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