EUR/USD
The EUR/USD pair trades with caution near the two-week low around 1.1570 during the early European trading session on Friday. The major currency pair struggles to gain ground as the US Dollar trades firmly due to multiple tailwinds: easing Federal Reserve dovish bets and improving United States-China trade relations.
GBP/USD
GBP/USD inches higher after three days of losses, trading around 1.3160 during the Asian hours on Friday. The pair holds ground as the US Dollar struggles amid improving Federal Reserve rate cut bets. According to the CME FedWatch Tool, markets are now pricing in 71% probability of a Fed rate cut in December, up from 66% the previous day.
USD/JPY
The Japanese Yen (JPY) remains on the front foot against a flattish US Dollar (USD), though it lacks bullish conviction and remains within striking distance of the lowest level since February, touched the previous day. Data released during the Asian session on Friday showed that inflation in Tokyo rose at a faster pace and backed the case for further policy tightening by the Bank of Japan (BoJ). Investors, however, remain uncertain about the likely timing of the next BoJ rate hike amid expectations that Japan’s Prime Minister Sanae Takaichi will pursue aggressive fiscal spending plans, which, in turn, caps gains for the JPY.
AUD/USD
AUD/USD remains subdued for the third successive session, trading around 0.6550 during the Asian hours on Friday. The pair moves little following the release of China’s NBS Purchasing Managers’ Index (PMI) data. It is important to note that any shift in China’s economic conditions could also affect the Australian dollar (AUD), given the close trade ties between China and Australia.
NZD/USD
The NZD/USD pair trades with a negative bias for the third straight day on Friday and remains close to a one-week low, around the 0.5725 region, touched the previous day. Spot prices move little following the release of rather unimpressive China’s official PMIs and seem poised to register weekly losses amid the short-term bullish sentiment surrounding the US Dollar (USD).
USD/CAD
USD/CAD remains steady after registering gains in the previous session, trading around 1.3980 during the Asian hours on Friday. The pair appreciated as the US Dollar (USD) received support after Federal Reserve (Fed) Chair Jerome Powell’s comments lowered expectations for further interest rate cuts.
USD/CHF
The Swiss Franc (CHF) weakens against the US Dollar (USD) on Thursday, with USD/CHF extending its advance to a two-week high around 0.8026, as the Greenback strengthens broadly following the Federal Reserve’s (Fed) latest interest rate decision and renewed optimism over a US-China trade truce.
CRUDE OIL
WTI bears seem to be hesitating since yesterday allowing for a temporary stabilisation of the commodity’s price. In today’s report we are to have a look at the improvement of the US Sino trade relationship but also the Fed’s latest interest rate decision, the state of the US oil market, the sanctions on Russian oil and OPEC’s oil production intentions, all being on a fundamental level.
Gold struggles to capitalize on its modest uptick amid a mixed fundamental backdrop. The Fed’s hawkish stance acts as a tailwind for the USD and weighs on the commodity. The US-China trade optimism also contributes to capping gains for the XAU/USD pair.
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