Forex Today: Markets become wary before the upcoming set of US data

Thursday, January 8th Overview

Investor sentiment took a turn for the worse early Thursday, prompting a more cautious approach among market participants. The European Economic Calendar featured November’s Eurozone Producer Price Index (PPI) data, alongside insights into both business and consumer sentiment. Throughout the day, focus will shift toward U.S. jobless claims data, the October trade balance, and third-quarter unit labor costs.

On Wednesday, U.S. data indicated that business activity in the services sector saw significant growth in December. The Institute for Supply Management’s (ISM) Services Purchasing Managers’ Index (PMI) jumped from 52.6 in November to 54.4. Additionally, the employment index of the PMI increased to 52 from 48.9, suggesting more hiring in the sector. In contrast, the U.S. Bureau of Labor Statistics noted a decline in job openings, dropping from 7.44 million in October to 7.14 million in November. Following these developments, the U.S. dollar (USD) index gained traction, maintaining a stable position around 98.70 early Thursday, while U.S. stock index futures were down by 0.3% to 0.6%.

U.S. Secretary of State Marco Rubio announced plans to meet with Danish and Greenlandic officials next week, as reported by Reuters. This follows President Donald Trump’s intentions regarding Greenland, an autonomous territory of Denmark.

The Reserve Bank of Australia’s deputy governor, Andrew Hauser, stated that the Consumer Price Index (CPI) from November closely matched expectations. He added that a rate cut is unlikely in the near future. After reaching its highest level since October 2025 above 0.6760 on Wednesday, the Australian dollar faced pressure from the strengthened U.S. dollar, pulling it back down to trade around 0.6700, reflecting a drop of more than 0.3%.

A recent report from the Bank of Japan (BOJ) noted that there were no adjustments to economic assessments across Japan’s nine regions. Many areas reported moderate recovery or gradual improvement. After a slight gain on Wednesday, USD/JPY was seen consolidating just above 156.50 early Thursday.

Gold began to correct on Wednesday after a notable rise earlier in the week, decreasing by over 0.8%. XAU/USD was unable to capitalize on the risk-averse market sentiment, trading below $4,440 during the European morning.

The euro/USD pair continued to consolidate below 1.1700 after modest declines on Wednesday. German data indicated a 5.6% rise in factory orders on a monthly basis for November, surpassing market expectations of a 1% decline and supporting the euro’s strength.