Market Drivers; US Session, September 10

Markets Await Key US Data, Central Bank Decision

The US dollar maintained its upward trajectory on Tuesday, although its momentum appeared to be slowing as investors cautiously awaited the release of crucial US economic data. The US Dollar Index (DXY) remained near the upper end of its trading range, hovering around 101.70, ahead of the release of the Consumer Price Index (CPI) report on Wednesday.

Economic Indicators and Market Sentiment

In addition to the CPI, other important economic events scheduled for September 11 include the weekly MBA Mortgage Applications and the EIA’s weekly report on crude oil inventories. These data releases are expected to provide valuable insights into the health of the US economy and influence the direction of the dollar.

Key Currencies

The euro, meanwhile, continued its downward trend, approaching the key support level of 1.1000. The European Central Bank’s interest rate decision on September 12 will be a significant event for the eurozone and could impact the EUR/USD exchange rate.

The British pound remained relatively stable, fluctuating within a narrow range. The UK’s economic calendar for September 11 includes GDP figures, Balance of Trade results, Construction Output, Industrial and Manufacturing Production, and the NIESR Monthly GDP Tracker.

The Japanese yen resumed its downtrend against the US dollar, breaking below the 143.00 support level. The Bank of Japan’s Nakagawa is scheduled to speak on September 11, and his comments could influence the yen’s direction.

The Australian dollar retreated for the third consecutive day, encountering resistance near the 0.6650-0.6640 band. Consumer Inflation Expectations and a speech by the Reserve Bank of Australia’s Hunter are expected on September 11.

Commodity Markets

In the commodity markets, crude oil prices declined, falling to the vicinity of the $65.00 mark per barrel for the first time since early May 2023. Persistent demand concerns and a disappointing OPEC report contributed to the price decline.

Gold prices added to their recent gains, benefiting from the marginal appreciation of the US dollar and declining US yields. However, silver prices experienced modest losses, trading around the $28.30 zone after reaching two-day highs earlier in the session.

Forex Outlook

The overall outlook for the US dollar remains positive, supported by the strong US economy and expectations for further interest rate hikes from the Federal Reserve. However, the release of key economic data and the upcoming central bank meetings could introduce volatility into the currency markets. Investors should closely monitor these events and adjust their positions accordingly.