Market Drivers – US Session: Global Currencies Steady as Markets Await U.S. Data and Canada Jobs Report

The U.S. dollar continued to edge lower on Thursday, marking a second day of losses as investors weighed concerns over the ongoing government shutdown and falling Treasury yields. The weaker greenback helped risk sentiment recover across global markets, giving fresh momentum to major currencies and commodities.

Friday’s trading session is set to be eventful, with the U.S. consumer sentiment survey and inflation expectations from the New York Federal Reserve expected to provide new clues on the economic outlook. Several Federal Reserve officials are also scheduled to speak, potentially offering more guidance on future policy moves.

In Europe, the euro advanced to multi-day highs, buoyed by the softer dollar and improving investor confidence. Traders now turn their attention to Germany’s trade balance figures and upcoming remarks from European Central Bank policymakers. Meanwhile, the British pound gained strongly, breaking above key resistance levels after the Bank of England opted to keep interest rates unchanged, reinforcing stability in U.K. markets.

In Asia, the Japanese yen strengthened as the dollar retreated, erasing earlier gains from midweek trading. Market watchers are focused on Japan’s latest economic indicators, including the Bank of Japan’s summary of opinions and key leading indexes. The Australian dollar also benefited from improving risk appetite, climbing back toward a significant threshold ahead of new trade data releases.

Commodities painted a mixed picture. Oil prices slipped for a third consecutive day, falling below a key psychological mark as traders assessed the potential for oversupply amid slowing demand. Gold, on the other hand, rebounded strongly, touching three-day highs above the $4,000 level per ounce as investors sought safety amid the prolonged U.S. political standoff. Silver followed suit, building on recent gains to approach the $49 mark.

With markets on edge over Washington’s budget impasse and investors watching closely for clues on inflation and consumer confidence, Friday’s data could prove decisive in shaping the next move for both currencies and commodities worldwide.