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Forex Today: Majors stay quiet as investors await US' 'economic D-Day' sanctions
Here is what you need to know on Monday, August 24:
US Dollar: Momentum fades as yields stay high – MUFG
MUFG’s Lloyd Chan notes that the Dollar has extended its recent soft patch even as US Q3 GDP forecasts are upgraded to 2.5% annualized from 2.0%. Elevated fiscal deficits and long-end Treasury yields are weighing on sentiment.
Euro: ECB patience with inflation and growth tension – BNY
Geoff Yu at BNY notes that Europe is seeking a Goldilocks mix of improving activity without reigniting inflation, with Euro strength already tightening conditions.
British Pound holds near six-month highs as debt woes keep US Dollar rallies shallow
The British Pound (GBP) holds mild gains for the fourth consecutive day against the US Dollar (USD) on a calm Monday session, as ongoing concerns about the US Treasury’s bond buyback plans keep US Dollar bulls subdued.
British Pound: Range-trade now, 1.3700 in sight against US Dollar – UOB
United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note GBP/USD remains in a short-term consolidation, with price action confined between 1.3620 and 1.3665 after an overbought push to 1.3675.
Canadian Dollar: Trade conflict weighs on Loonie – Commerzbank
Commerzbank’s Michael Pfister says the latest breakdown in US–Canada trade talks and Ottawa’s planned retaliatory tariffs point to a potentially protracted trade conflict.
Australian Dollar holds near June highs, above 0.7150 ahead of expected Iran sanctions
The AUD/USD pair extends the sideways consolidative price move near its highest level since early June, touched on Friday, and holds steady above mid-0.7100s through the early European session.
ECB's Cipollone: Risk of economic stagnation and sharp inflation rise is rather remote
European Central Bank (ECB) Executive Board member Piero Cipollone said that ‌the risk of economic stagnation and a sharp increase in inflation due to the crisis in the Strait of Hormuz is rather remote, Reuters reported on Monday.
Canadian Dollar declines as US-Canada trade talks collapse
The USD/CAD pair recovers some lost ground to near 1.3820 during the early European session on Monday. The Canadian Dollar (CAD) weakens against the US Dollar (USD) after US-Canada talks collapse into a trade war.Â
Gold: Upside risks building as fiscal worries grow – ING
ING Commodities Strategist Ewa Manthey highlights that Gold has rebounded from its July lows near $4,000/oz to around $4,600/oz, supported by renewed investment demand, a weaker Dollar and mounting concerns over the US fiscal outlook.
WTI Oil flirts with the $85.00 level as markets await economic D-Day sanctions on Iran
Crude prices are trimming some of last week’s gains on Monday. The US benchmark West Texas Intermediate Oil is changing hands at $85.35, with investors awaiting details of a new package of US sanctions against Iran that might extend to Russia or China.
Equities: Resilience supported by strong macro – Danske Bank
Danske Research Team reports that Equities ended Friday higher, though several markets, especially in the US, finished the week lower. The team stresses that robust macro and earnings data, plus sector leadership from Materials over Utilities, show no defensive rotation.
Japanese Yen: Psychological resistance and intervention fears – MUFG
MUFG’s Teppei Ino reviews recent USD/JPY trading ahead of Jackson Hole. The pair opened near 159 and repeatedly tested the 160 level, which acted as psychological resistance as traders watched for possible Japanese intervention.