Market Drivers; US Session, July 31

BoJ Surprise, Fed Signal: The unexpected rate hike by the Bank of Japan (BoJ) surprised the foreign exchange (FX) world on Wednesday. The Fed left its policy rate unchanged but signaled a potential rate cut in September.
Upcoming Events:
Bank of England (BoE) decision: Odds are split regarding a probable rate reduction.

USD Index weakened due to BoJ-driven strength in the Japanese yen and a somewhat dovish message from Chief Powell after the Fed meeting. Key data releases include ISM Manufacturing PMI, Initial Jobless Claims, Construction Spending, and the final S&P Global Manufacturing PMI.

Currency Pairs:

EUR/USD reversed part of its weekly retracement, revisiting the 1.0850 region. GBP/USD saw modest gains around 1.2850 ahead of the BoE decision. USD/JPY retreated sharply after the BoJ rate hike, breaching the key 150.00 support. AUD/USD broke below 0.6500, signaling further losses.

Commodities

Gold prices advanced, retesting the $2,440 region per ounce troy. Silver also gained, approaching the $29.00 mark per ounce.

WTI Oil Prices: Geopolitical concerns and a drop in US crude oil inventories lifted WTI prices to around $78.00 per barrel.

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