Here’s what you need to know on Thursday, September 26:
After witnessing a solid turnaround in US trading on Wednesday, the US Dollar (USD) pauses its recovery and remains in a consolidation mode ahead of the European opening on Thursday.
Traders are cautious and refraining from placing fresh bets on the USD ahead of the release of US Federal Reserve (Fed) Chairman Jerome Powell’s pre-recorded speech. A host of other Fed officials will also make their scheduled appearances alongside Chairman Powell, with their respective speeches commencing at 13:10 GMT.
The Fed’s comments will be crucial in assessing the size of the next rate cut in November. Markets are already pricing in a 61% chance of a 50 basis point (bp) rate cut, according to the CME Group’s Fed Watch tool.
Fed Governor Adriana Kugler said late Wednesday that she “strongly supported” the Fed’s decision to cut interest rates by half a point last week. Kugler added that she “will support additional rate cuts in the future.”
Aside from the Fed’s comments, investors will also be looking to US durable goods orders and jobless claims data for fresh trading guidance.
The US dollar also paused its earlier rise as risk sentiment turned positive, thanks to renewed optimism surrounding China’s stimulus measures.
US Dollar PRICE This week
The table below shows the percentage change of the US Dollar (USD) against major currencies this week. The US Dollar was the strongest currency against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.13% | -0.18% | 0.51% | -0.69% | -0.85% | -0.72% | 0.04% | |
| EUR | -0.13% | -0.36% | 0.40% | -0.81% | -1.03% | -0.84% | -0.10% | |
| GBP | 0.18% | 0.36% | 0.81% | -0.45% | -0.67% | -0.48% | 0.27% | |
| JPY | -0.51% | -0.40% | -0.81% | -1.19% | -1.44% | -1.22% | -0.58% | |
| CAD | 0.69% | 0.81% | 0.45% | 1.19% | -0.10% | -0.02% | 0.72% | |
| AUD | 0.85% | 1.03% | 0.67% | 1.44% | 0.10% | 0.21% | 0.94% | |
| NZD | 0.72% | 0.84% | 0.48% | 1.22% | 0.02% | -0.21% | 0.75% | |
| CHF | -0.04% | 0.10% | -0.27% | 0.58% | -0.72% | -0.94% | -0.75% |
The heatmap shows percentage changes of major currencies. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you choose the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change shown in the chart will represent the USD (base)/JPY (quote).
Bloomberg News and Reuters reported earlier that China is considering injecting CNY1 trillion ($142 billion) worth of capital into major state-owned banks in a further effort to shore up the economy.
In addition, China’s Politburo, the country’s top leadership, held a meeting on Thursday and said it will reduce the reserve requirement ratio (RRR) and implement a strong interest rate cut. The recovery in risk sentiment is pushing Asian indices closer to two-year highs, with US S&P 500 futures, the risk barometer, up 0.60% so far.
Most G10 currencies benefited from risk repricing and a weakening US Dollar rebound. The higher-yielding Australian Dollar is seen as the best performer, leading AUD/USD back towards the highest level since February 2023. The Aussie capitalizes on fresh Chinese stimulus measures, last trading at 0.6860.
USD/JPY The pair bounced firmly before entering a consolidation just below 145.00. The pair remains supported by the risk-on sentiment in the market, which weighs on the safe-haven Japanese Yen. The local currency ignored the minutes of the Bank of Japan (BoJ) July meeting.
USD/CAD is posting small losses and retreating towards 1.3450, despite the latest drop in the price of oilBlack gold plunged 2% on Wednesday as supply concerns over the closure of the Libyan oil field eased. WTI is currently losing 1.45% on the day to trade near $69.
USD/CHF is trading sideways around 0.8500, awaiting the Swiss National Bank (SNB) monetary policy assessment for fresh clues.
GBP/USD The rebound is holding near 1.3350, supported by improved market sentiment and the divergence in monetary policies between the Fed and the Bank of England. BoE policymaker Megan Greene said on Wednesday that a “cautious and steady approach to monetary policy easing is appropriate.”
EUR/USD The dollar is testing 1.1150 once again, attempting a tepid recovery in early Europe ahead of speeches by European Central Bank (ECB) President Christine Lagarde and Fed Chair Jerome Powell. Lagarde is due to deliver the keynote address at the European Systemic Risk Board Annual Conference at 13:30 GMT.
The price of the Gold is trading directionlessly just below the all-time high of $2,671. Overbought conditions on the daily chart of Gold point to a possible downside correction in the near term.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
