Fundamental Market Analysis for September 11, 2024 EURUSD
Event to pay attention to today:
15:30 GMT+3. USD - Consumer Price Index
EURUSD:
The EUR/USD exchange rate ended a three-day losing streak on Wednesday, trading near 1.10500 during the Asian session. The increase in EUR/USD can be attributed to a decline in the value of the US dollar in anticipation of the release of the North American Consumer Price Index (CPI) data. The inflation report may provide new indications regarding the potential scale of the Federal Reserve's (the Fed) interest rate reduction in September.
The US dollar (USD) is encountering difficulties in the context of a sustained reduction in US Treasury bond yields. As of this writing, the two-year and ten-year US Treasury bond yields are at 3.57% and 3.62%, respectively.
However, last week's US labour market report has introduced an element of uncertainty regarding the likelihood of an aggressive interest rate cut by the Federal Reserve (Fed) at its September meeting. The CME FedWatch Tool indicates that the market anticipates a minimum 25-basis-point rate cut by the Fed at its September meeting. The probability of a 50 bps rate cut has decreased slightly to 31.0% from 38.0% a week ago.
The euro was subject to downward pressure as a result of the latest German inflation data. The Harmonised Index of Consumer Prices (HICP) increased by 2.0% year-on-year in August, in line with expectations. The monthly index showed a 0.2% decline, in line with forecasts. Similarly, the Consumer Price Index (CPI) remained at 1.9% year-on-year in August, meeting market expectations.
Trade recommendation: Trading predominantly Buy orders from the current price level.
15:30 GMT+3. USD - Consumer Price Index
EURUSD:
The EUR/USD exchange rate ended a three-day losing streak on Wednesday, trading near 1.10500 during the Asian session. The increase in EUR/USD can be attributed to a decline in the value of the US dollar in anticipation of the release of the North American Consumer Price Index (CPI) data. The inflation report may provide new indications regarding the potential scale of the Federal Reserve's (the Fed) interest rate reduction in September.
The US dollar (USD) is encountering difficulties in the context of a sustained reduction in US Treasury bond yields. As of this writing, the two-year and ten-year US Treasury bond yields are at 3.57% and 3.62%, respectively.
However, last week's US labour market report has introduced an element of uncertainty regarding the likelihood of an aggressive interest rate cut by the Federal Reserve (Fed) at its September meeting. The CME FedWatch Tool indicates that the market anticipates a minimum 25-basis-point rate cut by the Fed at its September meeting. The probability of a 50 bps rate cut has decreased slightly to 31.0% from 38.0% a week ago.
The euro was subject to downward pressure as a result of the latest German inflation data. The Harmonised Index of Consumer Prices (HICP) increased by 2.0% year-on-year in August, in line with expectations. The monthly index showed a 0.2% decline, in line with forecasts. Similarly, the Consumer Price Index (CPI) remained at 1.9% year-on-year in August, meeting market expectations.
Trade recommendation: Trading predominantly Buy orders from the current price level.
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