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EUR/USD trades lower near the 1.1370 area on Friday, struggling despite stronger-than-expected Eurozone business-activity figures. The US Dollar Index (DXY) remains firmer near 101.50, offering limited support to the pair.Germany’s preliminary HCOB Composite Purchasing Managers Index (PMI) climbed to 51.2 in July from 49.5, exceeding expectations of 49.8 and returning to expansion territory. Manufacturing PMI improved to 52.2 from 50.3, while Services PMI rose to 49.6 from 48.6 but remained below the 50.0 threshold separating expansion from contraction.Activity across the wider Eurozone also strengthened. The Composite PMI increased to 51.9 from 50.0, beating the 50.3 forecast. Manufacturing PMI advanced to…
Gold price (XAU/USD) drifts higher on Friday as the Greenback stands firm, even as growing speculation that the US-Iran war may last longer than expected could, in the end, hurt the prospects of the yellow metal. The XAU/USD trades at $4,065, up 0.38%.XAU/USD gains as softer US yields counter Fed hike betsThe US Dollar Index (DXY), which tracks the buck’s value against a basket of six currencies, is slightly higher at 101.46 and poised to end the week with gains of over 0.60%. The yellow metal is also being propelled by the decline in US Treasury yields, with the 10-year…
UOB Global Economics & Markets Research notes that Bank Indonesia kept its policy rate at 5.75%, opting to let earlier tightening filter through. Despite the pause, the team still expects three further hikes totalling 75 bps by end-2026 to stabilise the Rupiah and inflation expectations, while USD/IDR edged slightly higher after what markets perceived as a hawkish hold.Further BI hikes expected to support Rupiah”Bank Indonesia maintained its benchmark policy rate at 5.75% at the Jul MPC meeting, likely choosing to allow the cumulative 100 bps tightening implemented between May and June to fully transmit through the real economy.””Despite the policy…
Silver (XAG/USD) edges higher on Friday as a pullback in Oil prices pushes US Treasury yields lower, while the US Dollar (USD) fluctuates near recent highs. At the time of writing, XAG/USD trades around $58.60, up 2.40% on the day.Despite the pullback, Oil prices and US Treasury yields remain elevated, keeping Silver’s upside in check as persistent inflation concerns reinforce hawkish Federal Reserve (Fed) expectations.Higher borrowing costs typically weigh on non-yielding assets such as Silver. According to the CME FedWatch Tool, traders see an 80% chance of a rate hike in September, although the Fed is widely expected to leave…
Rabobank’s Senior FX Strategist Jane Foley describes EUR/USD as wary after the July European Central Bank (ECB) meeting. Foley notes that the Euro (EUR) failed to gain support despite a hawkish ECB tone, while the Dollar benefits from safe haven demand and Federal Reserve (Fed) expectations. Foley still expects EUR/USD to trade in a choppy range around 1.14 over a 1-to-3-month horizon.Euro struggles as Dollar stays supported”Despite the hawkish takeaway from the July ECB policy meeting, the EUR failed to find support.””CFTC speculators’ position data highlight that since the start of the Iran war, confidence in the EUR has been…
The yen was on course for its steepest weekly decline since May on Friday, capping a turbulent stretch that has sent the currency to new 40-year lows versus the dollar despite Japan’s pledges to stabilise the currency.Verbal efforts to support the yen have had limited effect, and some analysts believe even intervention would, at best, only buy policymakers some extra time.Unless the Bank of Japan raises rates more quickly, the structural forces weighing on the currency were likely to remain in place, they said.The U.S. Treasury Department on Thursday joined calls for rate hikes by the BOJ, warning that excessive…
ING’s Frantisek Taborsky reports that surging Oil and gas prices triggered a sharp hawkish repricing of policy paths in Poland, the Czech Republic and Hungary, taking implied tightening back to stressed March–April peaks. While ING’s economists keep their rate forecasts unchanged, they see higher market rates offering some protection and helping stabilise CEE FX despite a stronger Dollar and risk-off sentiment.Hawkish repricing and fair-value levels”The CEE region was hit hard yesterday by the global rise in oil and gas prices, triggering a sharp repricing of implied policy-rate paths. In Poland and the Czech Republic, markets effectively added one extra hike,…
India’s forex reserves jumped by USD 1.08 billion to USD 676.237 billion during the week ended July 17, according to the RBI data released on Friday.In the previous reporting week, the overall forex kitty had jumped by USD 964 million to USD 675.157 billion.Forex reserves had expanded to an all-time high of USD 728.494 billion during the week ended February 27 this year before the onset of the Middle East conflict, which led to several weeks of a drop as the rupee came under pressure and the RBI had to intervene in the forex market through dollar sales.Prime Minister Narendra…
The rupee recovered 18 paise to close at 96.55 (provisional) against the US dollar on Friday amid likely intervention by the Reserve Bank of India (RBI).A combination of factors, including heightened tensions in West Asia, FII outflows, and sustained negative sentiments at the domestic equity markets, maintained pressure on the local unit, according to forex traders.At the interbank foreign exchange, the rupee opened weaker at 96.81 and traded in the range of 96.30-96.81 before eventually settling at 96.55 (provisional), up 18 paise from its previous close.The rupee ended 20 paise weaker at 96.73 against the US dollar on Thursday. The…
The rupee avoided a record low on Friday as the Reserve Bank of India likely intervened to ease pressure from high oil prices, weak domestic equities and renewed corporate hedging, traders said.State-run banks were seen selling dollars shortly before the market opened at 9 a.m. IST, likely on behalf of the Reserve Bank of India, five traders told Reuters on Friday.The selling continued through most of the session, pulling the rupee higher before it ended at 96.5625 per U.S. dollar, little changed on the day.Brent crude topped $100 a barrel for the first time in two months before retreating about…