The US Dollar Index (DXY) faced downward pressure as US labor market data cooled and disinflationary pressures persisted in August, especially evident in Producer Prices. This has increased expectations of a rate cut by the Fed at its upcoming meeting.
Key Points for Friday, September 13:
- EUR/USD showed resilience after four days of losses, with upcoming Industrial Production data in the eurozone.
- GBP/USD broke above the 1.3100 level on Greenback weakness, with UK Inflation Rate data upcoming.
- USD/JPY continued lower on higher yields and USD weakness, with Industrial Production and Capacity Utilization data due.
- AUD/USD reached weekly highs on risk appetite, with the Westpac Leading Index on the horizon.
- WTI prices neared $70.00 per barrel on supply concerns ahead of Hurricane Francine.
- Gold hit record highs near $2,555 per troy ounce, driven by USD weakness and Fed easing expectations.
- Silver surged to two-week highs near $30.00 per ounce.
Analysis:
The weakening US Dollar, driven by lackluster labor market data and persistent disinflationary pressures, has sparked expectations of a Fed rate cut. This has had various effects across currency pairs, commodities, and indices. Investors should closely monitor upcoming economic data releases and central bank actions to navigate potential market movements and adjust their investment strategies accordingly.