The US dollar (USD) has reached a two-month high, fueled by worries about a potential government shutdown and a prevailing risk-averse sentiment in the foreign exchange markets. Additionally, the minutes from the FOMC indicated that more interest rate cuts could be on the horizon, though the overall tone was quite cautious.
Highlights on Thursday, October 9th include:
The U.S. Dollar Index (DXY) notched its third straight day of gains, pressing against the significant 99.00 level as U.S. Treasury yields came back within acceptable ranges. With the likelihood of a short-term resolution to the U.S. government shutdown nearly nonexistent, it seems that weekly initial unemployment claims will face yet another delay. In the meantime, all eyes will be on upcoming speeches from Secretary Powell along with his colleagues Bowman and Barr.
EUR/USD continued its downward trend, approaching the 1.1600 range, marking a six-week low. Results for Germany’s trade balance are anticipated, along with financial results from the ECB. Mr. Lane from the ECB is also set to address the public.
The GBP/USD pair dipped below the 1.3400 support level, largely due to the strength of the US dollar. RICS house price balances will be released across various channels.
USD/JPY is on a steady upward trajectory, reaching the 153.00 barrier for the first time since mid-February. Weekly foreign bond investment figures will be made available alongside machine tool orders.
Despite the dollar’s strength, AUD/USD saw a slight uptick, although crossing the 0.6600 threshold remains out of reach. The Melbourne Institute is set to release an inflation expectations survey.
In the oil market, U.S. WTI prices continued to climb, reaching multi-day highs near $63.00 per barrel as traders responded to OPEC+ production increases that fell short of expectations and higher-than-anticipated gains in EIA weekly oil supply.
Gold’s upward momentum seems relentless, with prices hitting around $4,060—an all-time high—largely due to persistent expectations that the Fed will lower interest rates, along with political uncertainties in France and an overarching risk-off atmosphere. Silver, meanwhile, rebounded sharply from Tuesday’s stagnation, soaring past $49.00 per ounce for the first time since April 2011.
