The major currency pairs are trading near the previous week’s closing levels as the new week begins. The New York Stock Exchange and the Nasdaq Stock Market will be open in normal hours on Monday, while bond markets will be closed for the Columbus Day holiday. During American trading hours, Minneapolis Federal Reserve President Neel Kashkari and Federal Reserve Governor Christopher Waller will be delivering speeches. The US Dollar (USD) gained strength against its major rivals last week, with the USD Index posting gains for the second consecutive week. As of Monday morning, the index remains steady at around 103.00. US stock index futures are trading slightly lower, reflecting a cautious stance.
The US Department of State expressed serious concern about the People’s Liberation Army’s military drills in the Taiwan Strait and around Taiwan. Additionally, CNN reported that at least four Israeli soldiers were killed and more than 60 people were injured in a Hezbollah drone attack in north-central Israel. The US Dollar was the strongest against the Canadian Dollar in the last seven days, as shown in the table indicating the percentage change of the USD against major currencies. The heat map illustrates the percentage changes of major currencies against each other, with the base currency selected from the left column and the quote currency from the top row.
EUR/USD closed the previous week’s trading day unchanged but ended the week in the red, fluctuating around 1.0930 at the start of the European session on Monday. GBP/USD remains in consolidation below 1.3100 after small losses last week, with upcoming employment and CPI data releases in the UK this week. USD/JPY is moving within a narrow range above 149.00, as Japanese Prime Minister Shigeru Ishiba stated he would not intervene in monetary policy. USD/CAD closed the previous eight trading days in positive territory, with the pair edging higher towards 1.3800 as Canadian markets remain closed for Thanksgiving Day.
Gold saw a nearly 1% increase on Friday following Thursday’s gains, with XAU/USD trading around $2,660. Inflation measures the rise in the price of a representative basket of goods and services, with headline and core inflation being key indicators. Core CPI, targeted by central banks, excludes volatile elements like food and fuel. High inflation can result in a stronger currency due to increased interest rates, although lower inflation may push currency values down. Gold historically served as a safe haven in times of high inflation, but its value can be negatively impacted by higher interest rates. Lower inflation tends to be positive for Gold as it brings interest rates down.
In conclusion, the forex market is seeing major currency pairs trading near previous week’s levels, with the USD gaining strength and key economic indicators driving market movements. The focus remains on geopolitical events, central bank policies, and upcoming data releases influencing currency pairs like EUR/USD, GBP/USD, USD/JPY, and USD/CAD. Additionally, Gold’s performance is tied to inflation levels and interest rate movements, making it a key asset to watch for investors. Stay updated on market developments and economic data to make informed decisions in the forex market.
