Currency Analysis and Technical Outlook (1-Hour Chart) – September 13, 2024
USD/JPY: Strong Sell
The USD/JPY pair is declining around 141.00, indicating a bearish trend. Japanese industrial production increased by 3.1% in July, supporting the yen. However, market focus is shifting to next week's Federal Reserve (Fed) meeting, where a 25 basis point rate cut is anticipated. This possibility of additional monetary easing is contributing to the bearish sentiment.
EUR/USD: Strong Buy
The EUR/USD pair is rising around 1.1090, surpassing the local high of September 9. The strong rise in the euro is attributed to the European Central Bank's (ECB) decision to cut the policy rate by 60 basis points to 3.65%. The ECB's action was in response to weak economic activity and a slowing pace of consumer price increases in the Eurozone. Meanwhile, in the US, Producer Price Index (PPI) data fell short of expectations, and labor market data worsened, increasing the likelihood of a Fed rate cut in September.
GBP/USD: Strong Buy
The GBP/USD pair is rising around 1.3150, recovering from earlier bearish trends. Today’s focus is on the Bank of England's (BoE) inflation forecasts and US consumer confidence data. The Fed and BoE will hold meetings next week, with the Fed hinting at monetary easing, while a rate cut by the BoE is not currently expected. However, the UK's economic activity remains sluggish, with July’s GDP stagnating for two consecutive months raising concerns.
NZD/USD: Buy
The NZD/USD pair is rising around 0.6180. New Zealand’s manufacturing PMI increased from 44.0 to 45.8 points, supporting the economy. Additionally, the lower-than-expected US PPI data has increased the likelihood of a 25 basis point rate cut by the Fed.
XAU/USD: Strong Buy
The XAU/USD pair is rising around 2570.00, reaching historical highs. US inflation data released this week came in below expectations, reducing the likelihood of a significant Fed rate cut in September. The ECB’s 60 basis point rate cut decision is also supporting gold prices.