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25.09.2023 Market Report


EUR/USD is keeping its range play intact near 1.0650 in the early European hours on Monday. Markets stay risk-averse, weighing the Fed’s ‘higher-for-longer’ rate view and lingering China’s property market woes. Germany’s IFO survey eyed. 


GBP/USD remains on the defensive below the mid-1.2200s early Monday. The US Dollar is clinging to the previous week’s gains alongside firmer US Treasury bond yields while the Pound Sterling weighs the Fed-BoE policy divergence amid a quiet calendar. 


The USD/JPY pair remains flat below the mid-148.00s during the early European session on Monday. Markets turn cautious amid the fear of FX intervention by the Japanese authorities. The pair currently trades around 148.35, losing 0.01% on the day.


AUD/USD retraces the previous session’s gains, trading lower around 0.6420 during the Asian session on Monday. However, the pair received upward support after the release of Australian PMI data on Friday, coupled with the soft US Dollar (USD).


NZD/USD looks to continue the two-day winning streak from the previous week, trading around 0.5960 during the early trading hours of the Asian session on Monday. However, the pair received upward support as the US Dollar (USD) retraced a portion of its intraday gains, which could be attributed to the fall in the US Treasury yields on Friday.


The USD/CAD pair consolidates its recent gains below the 1.3500 barrier during the early Asian session on Monday. The weakening of the US Dollar (USD) and a decline in the US Treasury bond yields weigh on the pair. As of writing, USD/CAD is trading around 1.3476, losing 0.05% on the day.


The USD/CHF pair attracts some dip-buying near the 0.9045 region on Monday and touches its highest level since June 13 during the Asian session. The prospect for further policy tightening by the Federal Reserve (Fed) assists the US Dollar (USD) to stand tall near a six-month high, which, in turn, is seen as a key factor acting as a tailwind for the USD/CHF pair. In fact, the US central bank reiterated the longer-for-higher narrative and warned last week that still-sticky inflation was likely to attract at least one more interest rate hike by the end of this year.


Oil prices rose in Asian trade on Monday, rising after their first negative week in four as the prospect of tighter supplies largely offset concerns over a potential slowdown in demand.


Gold price is easing toward $1,920, making it for a negative start to a key week ahead. The United States Dollar (USD) and the US Treasury bond yields have entered a phase of consolidation near last week’s high, as investors look to this week’s inflation data from the US and Europe for a fresh directional impetus.

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