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The US dollar ended the trading session with mixed performance after a brief surge on Wednesday. Risk-off flows returned amid tensions between Europe and Russia, as well as claims that North Korean-Japan tensions have been renewed, although the sentiment improved during US trading hours as the United States released positive economic data.
Wall Street is mixed, with the Dow Jones Industrial Average posting modest gains, but the S&P500 and the Nasdaq Composite are currently in the red. Finally, US Treasury yields picked up, with the 10-year Treasury note currently yielding 3.75%.
The EUR/USD pair currently trades around 0.9890, while GBP/USD trades around 1.1330. The USD/CAD finished the day with losses at around 1.3610, despite resurgent crude oil prices. WTI is now trading at around $87.90.
Economic Data
Data released on Wednesday showed the ISM Services Index dropped in September to 56.7, a reading above the 56 expected. Analysts at Wells Fargo point out the report is still consistent with expansion in the sector. They argue most of the details indicate continued growth with some modest giveback in the pace of activity.
US Businesses added 208,000 jobs for the month, better than the 200,000 Dow Jones estimate and ahead of the upwardly revised 185,000 in August, according to ADP.
Other Developments
Biden’s administration will consult with Congress on tools to reduce OPEC’s control over energy prices.
The United Kingdom is also planning to implement sanctions banning Russian services and limiting exports to the country.
The EU approved the eighth package of sanctions against Russia, including a price cap on Moscow’s crude oil and refined products. Russia’s Deputy PM Alexander Novak responded by saying his country would be willing to cut production to compensate for price caps, adding an oil price of $70 per barrel would be comfortable.
OPEC+ decided a cut oil production by 2 million barrels per day. They also announced they would no longer meet on a monthly basis.
The European Commission President Ursula von der Leyen also announced the Union is ready to discuss a temporary price cap on gas used to generate electricity, while the US White House reported the Department of Energy would release another 10 million oil barrels from the Strategic Petroleum Reserve.
The AUD/USD pair, on the other hand, trimmed most of its early losses and hovers around 0.6500. USD/CHF is up to 0.9830, while USD/JPY remains pat at around 144.50.
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