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25.10.2022 Market Report


EUR/USD is treading water below 0.9900 in early European trading, as the US dollar licks its wounds amid a better risk tone. Cooling bets of aggressive Fed rate hikes are underpinning the pair, despite discouraging euro area PMIs. Germany’s IFO awaited. 


GBP/USD is consolidating gains below 1.1300 amid broad US dollar weakness and an upbeat mood. Investors remain hopeful that the new UK PM Rishi Sunak will bring stability to the financial markets. Focus remains on the US data. 


The USD/JPY pair is displaying a lackluster performance below the critical hurdle of 149.00 in the Tokyo session. The asset has turned sideways following back-and-forth cues from the US dollar index (DXY). The juggling of the DXY below 112.00 indicates that the market mood is extremely quiet.


AUD/USD portrays the pre-event anxiety as it retreats from the intraday high to 0.6320 heading into Tuesday’s European session. The Aussie pair initially cheers softer US dollar but has been easing of late as traders await the first budget from Australia’s Labour government.


NZD/USD eases from intraday high, around 0.5710 heading into Tuesday’s European session, as the Kiwi pair buyers trace cautious comments from the Reserve Bank of New Zealand (RBNZ) official. Also challenging the quote’s upside momentum could be the mixed concerns surrounding China, the world’s biggest commodity user and an important customer of New Zealand.


USD/CAD treads water around 1.3700 during Tuesday’s Asian session, taking rounds inside a one-week-old megaphone formation of late.


The USD/CHF pair has extended its recovery above 1.0004 in the Tokyo session after a rebound from 0.9980. The asset has picked bids despite a subdued performance by the US dollar index (DXY). The mighty DXY is displaying an intraday inventory adjustment phase, which could deliver an explosion of the volatility contraction in the European session.


 Oil prices extended recent losses on Tuesday as markets remained cautious amid signs of weakening Chinese demand, while a slew of dismal economic indicators also brewed concerns over global crude appetite. 


Gold price remains on the back foot amid an extended risk rally. Easing aggressive Fed tightening bets keep USD, yields under pressure. XAU/USD remains stuck in a range, awaits US data for a fresh direction.

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