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2 10, 2025

GBP/USD clings to bullish stance

By |2025-10-02T16:42:54+03:00October 2, 2025|Forex News, News|0 Comments

GBP/USD Forecast: Pound Sterling clings to bullish stance

GBP/USD preserves its bullish momentum in the European session and trades near 1.3500 following four consecutive days of gains. The pair’s near-term technical outlook suggests that the bullish bias remains intact, while markets remain focused on political developments in the US.

The selling pressure surrounding the US Dollar (USD) persisted midweek as markets reacted to the uncertainty created by the shutdown of the federal government. Following a second round of voting on Wednesday, lawmakers failed to come to terms on restoring the government funding. Read more…

The Pound faces challenges: Weak data and external pressures mount


The GBP/USD pair is trading near 1.3445 on Wednesday, with the pound closing September with its first monthly decline against the US dollar since July.

Short-term price action remains under pressure from the looming US government shutdown, which threatens to delay the release of key US macroeconomic data, injecting uncertainty into the market. Read more…

GBP/USD Forecast: Pound Sterling looks to build on weekly gains

GBP/USD continues to stretch higher and trades above 1.3470 in the European session on Wednesday, after posting modest gains on Monday and Tuesday. The pair’s technical outlook highlights a bullish stance as market participants keep a close eye on US politics.

The broad-based selling pressure surrounding the US Dollar (USD) helps GBP/USD extend its weekly uptrend. During the Asian trading hours, the USD weakened against its rivals as the US federal government has officially shutdown after Republicans and Democrats failed to come to terms on accepting a funding bill. Read more…

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2 10, 2025

USD/JPY Forecast: Yen Holds Near 146.60 as Fed Cuts Loom and BoJ Shift Nears

By |2025-10-02T14:41:28+03:00October 2, 2025|Forex News, News|0 Comments

The Japanese Yen is struggling to hold ground as markets weigh two opposing forces: the Bank of Japan’s (BoJ) potential rate hike…


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Quick overview

  • The Japanese Yen is facing pressure from potential Bank of Japan rate hikes and US monetary easing expectations.
  • The upcoming Liberal Democratic Party leadership election adds uncertainty to Japan’s fiscal and monetary policy.
  • The US Dollar is under pressure due to expectations of Fed rate cuts and disappointing labor market data.
  • Technically, USD/JPY shows a bearish bias with key support levels at 146.57 and 146.02.

The Japanese Yen is struggling to hold ground as markets weigh two opposing forces: the Bank of Japan’s (BoJ) potential rate hike and ongoing US monetary easing expectations. The latest BoJ meeting summary shows policymakers are discussing a 0.25% hike in October. That would narrow the wide rate gap with the Federal Reserve and provide a floor for the Yen after months of weakness.

Japan’s political calendar adds to the uncertainty. The Liberal Democratic Party leadership election on October 4 will decide the next Prime Minister and could impact fiscal and monetary policy in the months to come. Until then the Yen is sensitive to both political and central bank headlines.

Fed Cuts and US Shutdown Weigh on Dollar

Across the Pacific, the US Dollar is under pressure. The CME FedWatch Tool shows markets fully pricing in a Fed rate cut this month and 90% chance of another in December. That dovish outlook is due to disappointing data: ADP reported a 32,000 drop in private payrolls for September, the biggest decline since March 2023. August numbers were also revised down, showing cracks in the labor market.

The ISM manufacturing index came in at 49.1, seven months of contraction. And the US government has shut down after lawmakers failed to agree on a funding bill. While shutdowns have historically had limited economic impact, this one could delay critical data releases like Nonfarm Payrolls.

Despite all this, US equities are holding up, the S&P 500 is extending its winning streak, reducing safe-haven demand for the Yen.

USD/JPY Technicals Show Bearish Bias

Technically, USD/JPY is weakening, down to 146.60. The pair has broken below both the 50- and 100- period SMAs (148.25 and 147.75) and a sequence of lower highs and lower lows.

USD/JPY Forecast: Yen Holds Near 146.60 as Fed Cuts Loom and BoJ Shift Nears
USD/JPY Price Chart – Source: Tradingview

Candlestick analysis supports this view: repeated rejections at 148.80 and a series of consecutive red candles looks like a “three black crows” pattern, a bearish continuation signal. The RSI at 31 is oversold, so a short lived bounce isn’t out of the question.

Levels to watch:

  • Support: 146.57, 146.02, 145.50
  • Resistance: 147.40, 148.20

Trade Idea (Bearish):

  • Entry: Short at break below 146.57
  • Stop-Loss: Above 147.40
  • Target: 146.02, then 145.50

For now the trend is down, bears are in control and buyers are waiting at resistance.

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.

His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.

His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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2 10, 2025

The EURNZD gathers some gains- Forecast today – 2-10-2025

By |2025-10-02T12:45:48+03:00October 2, 2025|Forex News, News|0 Comments


The EURNZD approached its last bullish rally from the resistance of the bullish channel at 2.0330, then begin forming bearish corrective waves, affected by stochastic negativity to gather the gains by reaching 2.0135.

 

We expect resuming the bearish corrective track, due to stochastic stability below 50 level, to expect its target to 2.0050 level, reaching the extra support at 2.000, while renewing the bullish attempts requires breaching the barrier near 2.0190, motivating the bullish attack to ease the mission of pressing on the resistance of the bullish channel.

 

The expected trading range for today is between 2.0000 and 2.0170

 

Trend forecast: Bearish

 

 





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2 10, 2025

Euro needs to clear 1.1770 to push higher

By |2025-10-02T12:40:25+03:00October 2, 2025|Forex News, News|0 Comments

EUR/USD holds its ground and trades modestly higher on the day at around 1.1750 in the European session on Thursday after closing virtually unchanged on Wednesday. While the technical outlook suggests that the bullish bias remains intact, 1.1770 could prove to be a tough resistance to crack.

Euro Price This week

The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the Canadian Dollar.

USD EUR GBP JPY CAD AUD NZD CHF
USD -0.44% -0.74% -1.66% 0.00% -1.05% -0.85% -0.21%
EUR 0.44% -0.31% -1.38% 0.44% -0.62% -0.43% 0.22%
GBP 0.74% 0.31% -0.99% 0.75% -0.38% -0.12% 0.52%
JPY 1.66% 1.38% 0.99% 1.73% 0.68% 0.71% 1.53%
CAD -0.01% -0.44% -0.75% -1.73% -1.01% -0.85% -0.23%
AUD 1.05% 0.62% 0.38% -0.68% 1.01% 0.20% 0.84%
NZD 0.85% 0.43% 0.12% -0.71% 0.85% -0.20% 0.79%
CHF 0.21% -0.22% -0.52% -1.53% 0.23% -0.84% -0.79%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

The US Dollar (USD) found it difficult to stay resilient against its major rivals on Wednesday amid the heightened uncertainty created by the shutdown of the federal government. Additionally, mixed macroeconomic data releases made it difficult for the USD to stage a rebound.

The Automatic Data Processing (ADP) reported that private sector payrolls contracted by 32,000 in September. Additionally, the August print of 54,000 got revised down to -3,000. Other data from the US showed the Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers’ Index (PMI) rose to 49.1 in September from 48.7 in August, but remained in the contraction territory. The Prices Paid Index component of the PMI survey declined to 61.9 from 63.7, while the Employment Index edged higher to 45.3 from 43.8.

Lawmakers failed to make progress on restoring the government funding on Wednesday. Hence, the weekly Initial Jobless Claims, published by the Department of Labor, and the Census Bureau’s Factory Orders data will not be released later in the day. Instead, investors will analyze the Challenger Job Cuts data for September to assess the labor market conditions. Although this report is not seen as a market-mover, the lack of other data releases could pave the way for a straightforward market reaction, with a noticeable increase in job cuts hurting the USD and vice versa.

Investors will also continue to scrutinize political developments in the US. If markets grow optimistic about the shutdown coming to an end soon, the USD could stage a decisive rebound and force EUR/USD to turn south.

EUR/USD Technical Analysis

The 100-period Simple Moving Average (SMA) on the 4-hour chart aligns as a pivot level at 1.1750 ahead of 1.1770, where the Fibonacci 23.6% retracement of the latest uptrend is located. Once EUR/USD climbs above 1.1770 and confirms that level as support, technical buyers could take action. In this scenario, 1.1820 (static level) could be seen as the next resistance level before 1.1900 (static level, round level).

On the downside, 1.1710-1.1700 (200-period SMA, Fibonacci 38.2% retracement) aligns as a strong support area before 1.1640 (Fibonacci 50% retracement).

Euro FAQs

The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day.
EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy.
The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control.
Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency.
A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall.
Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

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2 10, 2025

Platinum price provides sideways trading– Forecast today – 2-10-2025

By |2025-10-02T10:44:48+03:00October 2, 2025|Forex News, News|0 Comments


The (ETHUSD) price soared high in its last intraday trading, resuming its strong gains amid the dominance of the bullish corrective trend on the short-term basis and its trading alongside supportive trendline for this track, with the continuation of the positive pressure due to its trading above EMA50, with the emergence of the positive signals on the relative strength indicators, despite reaching overbought levels, indicating the strength of the positive momentum.

 

Therefore, our expectations suggest a rise in the (ETHUSD) price in its upcoming intraday trading, conditioned by its stability above $4,280, to target the initial resistance level at $4,500.

 

 

 

 

 

 

 

 

 

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2 10, 2025

The EURJPY gathers more of the gains– Forecast today – 2-10-2025

By |2025-10-02T10:39:18+03:00October 2, 2025|Forex News, News|0 Comments

The EURJPY pair surrendered to the extra negative pressure that was caused by stochastic decline from the oversold level yesterday, which forces it to resume the attempts of profit-taking and forming new bearish corrective trading, to settle near the support at 172.20.

 

Note that the stability of the price within the bullish channel’s levels until now, and the stability of the current support at 172.20 will increase the chances of activating the bullish attempts, to breach 173.40 level and achieving some gains by its rally to 174.40, while facing new negative pressure and reaching below the current support will increase the chances of targeting the support of the bullish channel at 171.30, representing the confirmation of the main trend in the upcoming trading.

 

The expected trading range for today is between 172.20 and 173.50

 

Trend forecast: Bullish



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2 10, 2025

XAG/USD trades firmly above $47 as Washington closes down

By |2025-10-02T08:44:08+03:00October 2, 2025|Forex News, News|0 Comments


  • Silver price clings to gains above $47 amid the US government shutdown.
  • US Vice President Vance warns of massive layoffs if the government remains shut down for longer.
  • The US private sector labor force saw a reduction of 32K employees in September.

Silver price (XAG/USD) holds onto gains near the all-time high around $47.80 during the Asian trading session on Thursday. The white metal posted a fresh all-time high on Wednesday as funding to the United States (US) government stopped after the short-term funding bill failed to achieve a majority in the House of Senate on Tuesday.

The US government shutdown has increased the appeal of safe-haven assets, such as Silver.

US Vice President (VP) JD Vance has warned that the White House would need to resort to lay-offs if the shutdown remains for more than a few days, Reuters reported.

Such a scenario could boost hopes of more interest rate cuts by the Federal Reserve (Fed) to tackle a weak labour market outlook.

Meanwhile, the job demand in the private sector has also worsened due to new economic policies announced by US President Donald Trump. On Wednesday, the ADP reported that the private sector removed 32K payrolled workers in September, while it was expected to have hired 50K fresh job-seekers. Additionally, the August ADP Employment data was also revised from an addition of 54K workers to a reduction of 3K employees.

In Thursday’s session, the Initial Jobless Claims data for the week ending September 27 is unlikely to be released due to the US government shutdown, a scenario that will force Fed officials to look for other private sources to get cues on the current status of individuals seeking jobless benefits.

Silver technical analysis

Silver price oscillates inside the Wednesday’s range around $47.25, remains close to its all-time high of $47.80 posted the same day. Upward-sloping 20-day Exponential Moving Average (EMA) around $44 suggests that the near-term trend remains bullish.

The 14-day Relative Strength Index (RSI) trades inside the bullish range of 60.00-80.00, indicating a strong bullish momentum.

Looking up, the Silver price could extend its upside to near the psychological level of $50.00. On the downside, the 20-day EMA will act as key support.

Silver daily chart

Silver FAQs

Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.

Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold’s. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.

Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.

Silver prices tend to follow Gold’s moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.

 

 



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2 10, 2025

Goldman Sachs; Revising GBP forecasts higher; new targets for GBP/USD and EUR/GBP

By |2025-10-02T08:37:31+03:00October 2, 2025|Forex News, News|0 Comments

GBP/USD daily

Goldman Sachs has upgraded its GBP forecasts across major currency pairs, citing better-than-expected UK growth, fiscal discipline, and limited direct exposure to US tariffs. Sterling has also benefited from political stability, a stronger services sector, and supportive rate differentials. With risks skewed in the UK’s favor compared to the Eurozone and signs of renewed investor appetite for GBP assets, Goldman now expects higher GBP/USD and lower EUR/GBP through the remainder of 2025 and into 2026.

Key Points:

1️⃣ Forecast Revisions: GBP Upgraded Across the Board 🔼

  • GBP/USD

    • Old Forecasts: 1.25 (3M), 1.28 (6M), 1.30 (12M)

    • New Forecasts: 1.28 (3M), 1.32 (6M), 1.35 (12M)

  • EUR/GBP

    • Old Forecasts: 0.86 (3M), 0.85 (6M), 0.84 (12M)

    • New Forecasts: 0.84 (3M), 0.83 (6M), 0.82 (12M)

2️⃣ Domestic Data and Political Factors Support GBP 📊

3️⃣ Tariff Exposure Lower Than Eurozone ⚖️

  • UK is less exposed to looming US tariffs, reducing downside risks relative to EUR.

  • Tariff-driven risk-off flows are less likely to hurt GBP than EUR.

4️⃣ Rate Differential Still Attractive 💷

Conclusion:

Goldman Sachs now expects stronger GBP performance across both USD and EUR pairs, driven by UK macro resilience, limited tariff exposure, and constructive investor sentiment. With GBP/USD revised up to 1.35 and EUR/GBP expected to slide to 0.82 by 12 months, the bank sees sterling as well-positioned for further gains, especially relative to the Euro.

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2 10, 2025

XAU/USD buyers take breather before the next run to $4,000

By |2025-10-02T06:42:35+03:00October 2, 2025|Forex News, News|0 Comments


  • Gold holds the previous retracement from record highs of $3,895 early Thursday.
  • US Dollar struggles with its overnight rebound amid US government shutdown concerns.     
  • Technically, Gold remains a ‘buy-the-dips’ trade, with the four-hourly RSI within the bullish zone.

Gold is modestly in the red for the first time in six trading days early Thursday, holding its retreat from record highs of $3,895 reached mid-Wednesday.

Gold stays supported amid US fiscal and data woes

Concerns over the United States (US) government shutdown-induced delay in critical employment and inflation data weighed on investors as they flocked to safety in the traditional safe haven Gold.

The delay in the US statistics could probably raise doubts on the scope and timing of further US Federal Reserve (Fed) interest rate cuts beyond the October 28-29 meeting, This narrative dented the sentiment around the US Dollar (USD), further helping Gold stretch its record raly.

However, the USD changed course in the mid-American session and staged a decent comeback following the news that the Supreme Court allowed Fed Governor Lisa Cook to remain in her post pending oral arguments in January on whether President Donald Trump has legal cause to fire her., per CNBC News.

Gold paused its record run and pulled back sharply from fresh lifetime highs on the USD turnaround to settle Wednesday near $3,865.

In Thursday’s trading so far, Gold is consolidating the previous retracement moves, supported above the $3,850 barrier.

The bright metal is drawing support from lingering geopolitical tensions surrounding Russia and Ukraine.

The Group of Seven (G7) nations vowed to tighten sanctions enforcement against Russia, pledging to phase out remaining imports and warning of penalties for countries and firms helping to finance Moscow’s war effort.

Following this announcement late Wednesday, the Wall Street Journal (WSJ) reported, quoting US President Trump that he will provide Ukraine with intelligence to support long-range missile strikes on Russian energy infrastructure.

 Additionally, impending worries over the effects of the US shutdown and increased October Fed rate cut expectations will likely keep any pullback in Gold price short-lived as markets take account of weakening US labor market conditions.

The Automatic Data Processing (ADP) showed on Wednesday, private companies shed a seasonally adjusted 32,000 jobs during the month, the biggest slide since March 2023. Markets expected an increase of 50,000 in the reported month.

The US ADP data outweighed the uptick in the ISM Manufacturing PMI to 49.1 in September.

Looking ahead, traders will continue to pay close attention to whether the lawmakers will reach an interim deal to pause the shutdown, enabling the release of the US weekly Jobless Claims and August Factory Orders, originally scheduled later in the day.

Gold price technical analysis: Four-hourly chart

As observed on the four-hour chart, the 14-day Relative Strength Index (RSI) remains within the bullish territory, currently near 64.

Therefore, the leading indicator suggests that the Gold uptrend remains well in place in the near term, and that any dip could be quickly bought in.

Buyers must find acceptance above the $3,900 level on a daily closing basis to resume the bullish momentum.

The next topside hurdle is located at the $3,950 barrier on the way to the $4,000 mark.  

Conversely, any retracement pullback could test the initial support at $3,839, the 21-Simple Moving Average (SMA), below which the 50-SMA at $3,787 would be tested.

Deeper correction could target the September 24 low near $3,720, where the 100-SMA coincides.

Gold FAQs

Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.



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2 10, 2025

Euro to US Dollar Forecast: EUR Rallies, USD Slides on Fresh Jobs Shock

By |2025-10-02T04:35:53+03:00October 2, 2025|Forex News, News|0 Comments


– Written by

The Euro to Dollar (EUR/USD) exchange rate posted gains on the US shutdown and following weaker than expected US jobs data. It failed to hold initial 1-week highs amid a retreat on the crosses, but traded above 1.1750 and close to 1-week highs.

Scotiabank commented; “We are somewhat heartened by the prior break of the descending trend line drawn from the descending July highs and see little in terms of resistance ahead of 1.18 and the mid-September high just above 1.19.”

ING is also positive on the outlook; “we think the US government shutdown and the softer dollar story should dominate today and could be enough to drag EUR/USD to 1.1800/1820.”

Most investment banks, including ING, Scotiabank and MUFG expect medium-term EUR/USD gains to 1.20.

ADP reported a decline of 32,000 in private-sector jobs for September compared with consensus forecasts of an increase close to 50,000 while the August data was revised to slow a decline on 3,000 compared with the original reading of a 54,000 increase.

Chief Economist Dr. Nela Richardson commented; “Despite the strong economic growth we saw in the second quarter, this month’s release further validates what we’ve been seeing in the labor market, that U.S. employers have been cautious with hiring.”

Overnight, the US Senate failed to break the impasse on government funding and the government started to close down.

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The shutdown comes at a particularly difficult time given uncertainty over the labour market and economy. The jobless claims data and employment report are liable to be postponed.

President Trump has also threatened to fire thousands of workers, adding to the uncertainty.

Scotiabank commented; “The shutdown may trigger government worker furloughs or layoffs and will halt the publication of key government data releases—such as Friday’s NFP report—which will compound investor concerns about the status of the US economy.”

MUFG sees scope for further vulnerability; “If Trump does follow through with firing workers and the shutdown becomes prolonged, the rates market will at least look to price a greater prospect of a rate cut in October and December, a scenario still not fully priced, which will likely weigh on dollar performance over the short-term.”

Following the data, markets were pricing in close to a 100% chance of a Fed rate cut at the October meeting and the chances of a further cut in December increased to near 90%.

The Euro-Zone inflation data met market expectations with the headline rate increasing to 2.2% from 2.0% with the core rate holding at 2.3%.

The data reinforced expectations that the ECB would hold rates steady in the short term.

According to Scotiabank, there is a green light for further Euro gains; “EUR fundamentals remain supportive as we note the renewed rise in Germany-US yield spreads, and sentiment is providing an added boost as the options market prices a greater premium for protection against EUR strength.”

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