Market Drivers; US Session, September 09

The US Dollar continued its upward trajectory on Monday, despite a general decline in US Treasury yields. This positive sentiment reflects steady expectations that the Federal Reserve will implement a rate cut at its upcoming meeting.

The US Dollar Index (DXY) reached its highest level in three days, approaching 101.80. Investors are increasingly pricing in a 25 basis point rate cut as the most likely scenario at the Fed’s next policy meeting.

Currency Pairs:

EUR/USD retreated to recent lows near 1.1030, pressured by the stronger US Dollar. GBP/USD declined to three-week lows near 1.3070, also impacted by the US Dollar’s strength. USD/JPY gained ground, approaching the 144.00 region. AUD/USD traded in a volatile manner, ending the day with slight losses.

Commodities:

Crude oil prices recovered slightly, supported by concerns over supply disruptions. Gold prices rose modestly, regaining the $2,500 per ounce mark. Silver prices also increased, despite the stronger US Dollar.

Economic Indicators:

The NFIB Business Optimism Index is scheduled for release on September 10. The API’s weekly report on US crude oil supplies is also expected on Tuesday. The final Inflation Rate in Germany will be published on September 10. The UK’s labour market report is due.

The Westpac Consumer Confidence, NAB Business Confidence, final Building Permits, and final Private House Approvals will be released in Australia on September 10. The BoJ’s Nakagawa will deliver a speech on September 11.

US Dollar’s strength reflects the market’s anticipation of a more dovish Federal Reserve. As we look ahead, economic data releases and central bank announcements will continue to influence currency movements and commodity prices.