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ING’s Francesco Pesole notes the Pound has been resilient against the Dollar and EUR/GBP has fallen about 0.5% since Friday, partly on positioning ahead of the Bank of England meeting. Source
Signs of broadening inflation have prompted traders to add to wagers on a rate hike by the Reserve Bank of India next month. | Photo Credit: iStockphoto The rupee fell to its weakest level in more than a month on Tuesday but held above 96 per dollar as likely central bank intervention limited losses driven by surging oil prices and bets on a US rate hike this week.The rupee settled at 95.9550 per dollar, down 0.4 per cent on the day, its biggest one-day fall since mid-July.Brent crude rose more than 2 per cent to $108.20 a barrel, raising concerns…
EUR/JPY extends its gains for the second consecutive day, trading around 179.00 during European hours on Tuesday. The currency cross is trending upward as the Japanese Yen (JPY) faces headwinds from rising global oil prices, which significantly inflate import costs for Japan’s energy-dependent economy.Despite these immediate pressures, the JPY could retain underlying support from anticipation of more aggressive monetary tightening by the Bank of Japan (BoJ); the ongoing unwinding of global carry trades and subtle signs of domestic investors repatriating foreign assets all provide a steady cushion for the currency.Meanwhile, the Euro (EUR) continues to find firm backing from persistent…
Gold (XAU/USD) attracts some dip-buyers near the $4,284-$4,283 region during the Asian session on Tuesday and moves away from an over one-month low, touched the previous day. Any meaningful appreciation, however, seems elusive amid a bearish fundamental backdrop and ahead of the crucial two-day FOMC policy meeting, starting later today.The US Federal Reserve (Fed) is scheduled to announce its decision on Wednesday, and the latest US inflation figures, released last week, lifted bets for an imminent interest rate hike. The focus, however, will be on updated economic projections, including the so-called dot plot, and Fed Chair Kevin Warsh’s comments during…
The dollar inched up to trade near a two-week high on Tuesday as surging oil prices lifted Treasury yields and reinforced expectations that the Federal Reserve will raise interest rates this week.It also gained support as risk appetite weakened after stock markets tumbled, with AI-related shares under pressure after industry leaders called for slower development to contain potential threats to humanity.Markets now see a Fed hike on Wednesday as a near certainty, with CME’s FedWatch tool pricing in a roughly 93% chance of an interest-rate increase, which would be the first in more than three years.”The combination of higher oil,…
Iran’s President Masoud Pezeshkian said on Monday that Tehran is not at war with Saudi Arabia. Pezeshkian added that Iran’s demands for negotiation with the United States (US) are the same as our previous demands.Meanwhile, US President Donald Trump said the US is open to engaging with Iran after previously repeatedly insisting that he did not want to negotiate with the Islamic Republic. Trump further stated on Monday that oil is flowing through the Hormuz Strait and the price will drop after the Iran conflict ends.Key quotes from Iran’s President Pezeshkian How can we negotiate with the United States, when…
The Dollar Index trades near 99.50, up 0.4% on the day, and it made the whole of that gain while America was asleep. A 5% Treasury yield sounds like the best thing that could happen to the Dollar, and New York has spent the morning selling it.That is because a currency is paid for the gap between its interest rates and everyone else’s, not for the level, and the gap isn’t widening: the European Central Bank (ECB) raised rates last week, the Bank of Japan (BoJ) does it on Friday, and the Bank of England (BoE) has a move priced…
OCBC strategist Christopher Wong says oil risks have risen again as disruptions to Saudi export infrastructure and renewed concerns around the Strait of Hormuz and Bab el-Mandeb keep supply risks elevated. He argues that Brent’s pullback from near $110/bbl may prove limited, with a renewed rise in oil threatening to complicate the inflation outlook, support yields and weigh on risk sentiment, while a swift restoration of flows or signs of de-escalation could reduce the geopolitical premium.Brent risks skewed to renewed gains”Oil risks have picked up again over the weekend. Saudi Arabia temporarily shut its East-West pipeline after a drone attack,…
Commerzbank’s Thu Lan Nguyen notes that stronger-than-expected core US inflation has pushed market pricing toward a near-certain Federal Reserve rate hike this week and higher odds of another move by year-end. However, EUR/USD quickly retraced its initial Dollar gains, as investors weigh doubts about the Fed’s tightening sufficiency and a rising USD risk premium linked to potential political confrontation with President Trump.Fed hike odds and Dollar risk”At first glance, the picture seemed straightforward: US consumer prices excluding volatile components rose more strongly than expected in August. At the same time, the Fed had recently made it clear that if inflation…
EUR/JPY gains ground after registering losses in the previous day, trading around 178.30 during Asian hours on Monday. Technical analysis of the daily chart indicates the currency cross remains within the descending channel pattern, signalling an ongoing bearish bias.The EUR/JPY cross is retaining a bearish near-term bias as spot holds beneath both the nine- and 50-period Exponential Moving Averages (EMAs). The Moving Average Convergence Divergence is not available, but the 14-day Relative Strength Index (RSI) at 26.98 sits in oversold territory, hinting that while downside pressure dominates, the sell-off could start to lose momentum if buyers attempt to defend nearby…