Market participants are likely to keep a close eye on currency strength and weakness over the weekend while the Japanese market is closed

Market participants are likely to keep a close eye on currency strength and weakness over the weekend while the Japanese market is closed

23.09.2022

In yesterday's U.S. currency trading, the dollar fluctuated against the euro as the U.S. August Leading Economic Index improved to -0.3% from -0.4% the previous month, with the EUR/USD pair trading between 0.9808 and 0.9907.During today’s Asian session, the EUR/USD pair has edged lower, testing the downside. With the Dollar Index remaining at a high level of 111.3, we should remain cautious of further declines heading into the weekend.

Among European currencies, the pound fell against the U.S. dollar following yesterday’s announcement that the policy rate had been raised to 2.25%. Although the GBP/USD pair rebounded from 1.1209 to 1.1364, it gave up nearly all of those gains following the rate announcement and is currently testing support around 1.1235 during Asian trading hours.As GBP/USD is in the midst of hitting new lows, traders should exercise caution regarding excessive contrarian trades.

Today, at 16:15, France’s Manufacturing/Services PMI; at 16:30, Germany’s Manufacturing/Services PMI; at 17:00, the Eurozone’s Manufacturing/Services PMI; at 17:30, the UK’s Manufacturing/Services PMI; at 19:00, the UK’s CBI Retail Trade Survey; at 21:30, Canada’s Retail Sales;at 10:45 PM, the U.S. Manufacturing/Services PMI; at 12:30 AM, remarks by SNB Governor Jordan; and at 3:00 AM, remarks by Fed Chair Powell, Fed Vice Chair Brainard, and Fed Governor Bowman. With the Japanese market closed, we will be closely monitoring currency strength and weakness over the weekend.