The US Dollar Index (DXY) saw a rise past the 103.00 barrier to reach new two-month highs on Thursday, as traders adjusted to the increasing likelihood of a 25 bps rate cut in November. The focus remains on US inflation ahead of the release of Producer Prices data, the Michigan Consumer Sentiment index, and speeches by Fed officials Goolsbee and Bowman.
In the foreign exchange markets, the euro struggled against the dollar, falling below the key 1.0900 support level. Investors are closely watching the Final Inflation Rate in Germany and Current Account results. Meanwhile, GBP/USD extended lower, approaching the important 1.3000 support level. UK economic data releases include GDP figures, Goods Trade Balance, Industrial Production, Manufacturing Production, Construction Output, and the NIESR Monthly GDP Tracker.
After hitting new highs around 149.50, USD/JPY saw a slight pullback on Thursday. Coming up on the Japanese economic calendar are Industrial Production figures on October 15. AUD/USD bucked the trend among risky currencies, seeing moderate gains after five consecutive daily losses. The Westpac Leading Index and a speech by the RBA’s Hunter are scheduled for October 16.
In commodities, WTI prices surged on geopolitical concerns and hopes of increased demand from China and the US. Both Gold and Silver prices bounced back after several days of decline, with Gold reclaiming the $2,630 level and Silver surpassing $31.00 per ounce.
Overall, the US Dollar strengthened on Thursday as CPI data and comments from Fed officials bolstered expectations of a November rate cut. With key economic data releases and speeches ahead, market participants are closely monitoring the evolving inflation debate and its impact on currency pairs. Major currencies like the euro and pound faced downside pressure, while safe-haven assets like Gold and Silver rebounded amid geopolitical uncertainties and recovering demand in key markets.
