Trusted by over 15 Million Traders
The Most Awarded Broker
for a Reason
CATEGORIES
News
- EUR/USD rebounds from one-month lows amid weakening dollar and Fed divergence
- Big data and Canadian Federal Reserve interest rate decisions are coming
- The US dollar index is expected to rise, and the Federal Reserve decided to work
- "Tep Club" finalizes Alaska! White House clarifies gold bar tariffs
- The United States may see recession signals, but the euro zone secretly "recover
market analysis
Inflation data fell short of expectations, triggering a slight correction in the U.S. dollar, which may remain strong in the near future
Wonderful introduction:
A secluded path, with its twists and turns, will always arouse a refreshing yearning; a huge wave will make a thrilling sound when the tide rises and falls; a story, regretful and sad, only has the desolation of the heart; a life, with ups and downs, becomes shockingly heroic.
Hello everyone, today XM Forex will bring you "[XM official website]: Inflation data is lower than expected, triggering a slight correction in the US dollar, and it may still remain strong in the near future." Hope this helps you! The original content is as follows:
During the European trading session on Monday (October 27), the U.S. dollar index traded around 98.80, fluctuating slightly and falling. The dollar index weakened further as the inflation data released last Friday was relatively benign and the market expected that the United States may cut interest rates. Mahjabin Zaman, head of foreign exchange research at ANZ, said: "Looking ahead, we think the dollar is likely to remain strong in the near term. The interest rate cuts from the Fed's October and December meetings are fully priced in. So if anything, any Fed Any cautious remarks may be more beneficial to the dollar.”
Inflation data puts pressure on short-term sentiment about the dollar
Weak inflation data puts pressure on short-term sentiment about the dollar, with traders adjusting positions ahead of the release of a number of key U.S. economic data this week. The preliminary value of the U.S. Manufacturing Purchasing Managers Index (PMI) was recorded at 52.2, while the preliminary value of the services PMI unexpectedly rose to 55.2, indicating that despite the slowdown in price growth, the U.S. economy still has potential resilience.
The market generally expects that due to lower-than-expected inflation data, the U.S. Federal Reserve will cut the current benchmark interest rate by 0.25 percentage points from 4.25% to 4.00% on Wednesday. According to data released by the U.S. Bureau of Labor Statistics on Friday, the U.S. consumer price index rose 3.0% year-on-year in September, www.xmhouses.compared with the previous increase of 2.9%. This figure was lower than market expectations of 3.1%.
At the same time, core CPI increased by 3.0% year-on-year in September, www.xmhouses.compared with 3.1% in August; this increase was lower than market expectations of 3.1%. From a month-on-month perspective, after the CPI rose by 0.4% in August, it rose again in September.The month-on-month increase in core CPI was 0.2%, which was lower than the market consensus of 0.3%.
The knock-on effects of U.S. sanctions on Russian oil producers
ING believes that another aspect worthy of attention is the knock-on effect of U.S. sanctions on Russian oil producers. There are reports that some Indian and Chinese refiners are considering stopping oil imports from Russia. If there is a significant drop in Russian oil supplies, which has not happened under previous sanctions, the price of Brent crude oil is likely to return to the $70 to $75 per barrel range.
These price levels do have the potential to trigger significant appreciation of the U.S. dollar. So far, the impact of the surge in oil prices on foreign exchange markets has been particularly evident in the rise of the Norwegian krone; at the same time, this has also put additional pressure on the Japanese yen.
Impact of Sino-U.S. Trade
U.S. Treasury Secretary Bessent said that trade negotiations during the ASEAN Summit held in Kuala Lumpur, the capital of Malaysia, ruled out the possibility of the United States imposing 100% tariffs on Chinese imports from November 1. Bessant also said he expected China to delay the implementation of the licensing system for rare earth minerals and magnet products by a year while it re-examines relevant policies.
Optimism surrounding U.S.-China trade talks has eased fears of a trade war between the world's two largest economies.
Trump will meet with Chinese President Xi Jinping later on Thursday to discuss the framework of a trade agreement.
Upcoming key events in the United States
This week’s economic calendar contains a number of high-impact indicators that may determine the tone of the U.S. dollar.
On Tuesday, traders will focus on the Richmond Manufacturing Index and the Conference Board Consumer Confidence Index for the latest information on business and consumer sentiment.
Market focus will then turn to Wednesday’s Federal Open Market www.xmhouses.committee (FOMC) meeting, where the Fed is currently widely expected to cut interest rates by 25 basis points to 4.00%. Markets will be closely watching Chairman Powell's press conference for guidance on future easing policy.
Later this week, the preliminary value of U.S. gross domestic product (GDP) will be released on Thursday, with an expected growth rate of 3.0%; on Friday, core personal consumption expenditures (CorePCE) and employment cost index data will be released.
The release of these data will jointly determine whether the US dollar can hold the support level near 98.70 in the context of expected changes in interest rates, or continue to expand the extent of the recent correction.
Technical Analysis
Currently, the U.S. Dollar Index (DXY) is trading near 98.80, consolidating within a symmetrical triangle pattern, and traders are waiting for a breakthrough signal to appear. The 50-period exponential moving average (50-EMA, 98.83) and the 200-period exponential moving average (200-EMA,98.43) trends are flattening, reflecting a wait-and-see situation following recent volatility. The support levels are at 98.70 and 98.38 respectively, while the resistance level is near 99.14.
If the U.S. dollar index clearly breaks through the upper rail of the triangle, the price may push towards 99.54; if it falls below 98.38, it may trigger selling pressure and push the price towards 98.01. The relative strength index (RSI) is currently around 45, indicating that the long and short kinetic energy is balanced, and there is no obvious dominant party.
The above content is all about "[XM official website]: Inflation data is lower than expected, triggering a slight correction of the US dollar, and it may still remain strong in the near future". It is carefully www.xmhouses.compiled and edited by the XM foreign exchange editor. I hope it will be helpful to your trading! Thanks for the support!
Only the strong know how to fight; the weak are not even qualified to fail, but are born to be conquered. Hurry up and study the next content!
Disclaimers: XM Group only provides execution services and access permissions for online trading platforms, and allows individuals to view and/or use the website or the content provided on the website, but has no intention of making any changes or extensions, nor will it change or extend its services and access permissions. All access and usage permissions will be subject to the following terms and conditions: (i) Terms and conditions; (ii) Risk warning; And (iii) a complete disclaimer. Please note that all information provided on the website is for general informational purposes only. In addition, the content of all XM online trading platforms does not constitute, and cannot be used for any unauthorized financial market trading invitations and/or invitations. Financial market transactions pose significant risks to your investment capital.
All materials published on online trading platforms are only intended for educational/informational purposes and do not include or should be considered for financial, investment tax, or trading related consulting and advice, or transaction price records, or any financial product or non invitation related trading offers or invitations.
All content provided by XM and third-party suppliers on this website, including opinions, news, research, analysis, prices, other information, and third-party website links, remains unchanged and is provided as general market commentary rather than investment advice. All materials published on online trading platforms are only for educational/informational purposes and do not include or should be considered as applicable to financial, investment tax, or trading related advice and recommendations, or transaction price records, or any financial product or non invitation related financial offers or invitations. Please ensure that you have read and fully understood the information on XM's non independent investment research tips and risk warnings. For more details, please click here