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The US Dollar Index (DXY) extended its recent modest decline, falling under pressure as market participants increased their bets on further interest rate cuts by the Federal Reserve. This sentiment pushed the DXY toward a key support level around 100.00, despite mixed movements in US Treasury yields.
Key Economic Events Ahead
Tuesday, November 25, presents a busy US economic calendar, which will be closely watched for any shifts in the Fed’s outlook. Major releases include the ADP Employment Change, Retail Sales, Producer Prices, the Conference Board’s Consumer Confidence, the FHFA’s House Price Index, Pending Home Sales, and the API’s weekly report on US crude oil inventories.
Currency Pair Highlights
EUR/USD showed a promising start to the week, recovering after six straight days of losses. The pair revisited the 1.1550 region. Focus in the Eurozone will be on Germany’s final Q3 GDP Growth Rate and speeches by officials from the European Central Bank (ECB).
GBP/USD achieved a modest gain, maintaining a three-day recovery trend and testing the 1.3120 area. The sole significant release from the UK will be the CBI Distributive Trades report.
USD/JPY resumed its recent upward trajectory following a brief correction, approaching the 157.00 barrier. Japan’s calendar will feature the final readings of the Coincident Index and the Leading Economic Index.
AUD/USD traded positively, hovering near its crucial 200-day Simple Moving Average (SMA) around 0.6460 and building on its Friday rebound. Traders are looking ahead to Australia’s important Inflation Rate release on November 26, alongside quarterly Construction Work Done figures and a speech by a Reserve Bank of Australia (RBA) official.
Commodities Watch
Crude Oil (WTI) prices saw notable gains, trading in the sub-$58.00 per barrel area. This movement was influenced by traders assessing the potential for peace talks in the Russia-Ukraine conflict and the implications of probable Fed interest rate cuts in the coming months.
Gold maintained its volatile pattern but surpassed the $4,100 per troy ounce mark. The precious metal benefited from a weaker US Dollar and the ongoing expectations for further easing of monetary policy by the Fed.
Silver followed Gold’s lead, reversing two consecutive days of declines and once again approaching the $51.00 per ounce level.
