Should we keep a close eye on currency strength and weakness on the last day of the quarter?

Should we keep a close eye on currency strength and weakness on the last day of the quarter?

30.09.2022

In yesterday’s U.S. currency trading, the dollar faced resistance due to a slight dip in the 10-year Treasury yield, causing it to decline against the euro. The EUR/USD pair rose by just under 200 pips, from 0.9634 to 0.9816. It is currently trading just below the 75-period moving average on the 4-hour chart.Yesterday’s U.S. initial jobless claims came in at 213,000, in line with market expectations, but this did not provide sufficient support for the U.S. dollar. We will closely monitor price movements during U.S. trading hours today.

European currencies rose as expectations grew for a significant rate hike at the next ECB meeting following the release of Germany’s September consumer price index yesterday, which surged 10.0% year-over-year, signaling rapid inflation. The euro strengthened against the yen.The EUR/JPY pair rose by approximately 240 pips, from 139.401 to 141.723. It showed a strong upward move after breaking above the daily 20-day moving average (MA). However, since the EUR/JPY is currently in a range-bound market lacking clear direction on the daily chart, traders should remain cautious of random price movements triggered by economic data releases or comments from key figures.

Today’s economic indicators include UK Q2 GDP and Nationwide house prices at 3:00 PM, Swiss retail sales at 3:30 PM, the French Producer Price Index at 3:45 PM, the Swiss KOF Leading Index at 4:00 PM, the German unemployment rate at 4:55 PM, UK mortgage approvals at 5:30 PM, and at 6:00 PM, the EurozoneCPI, 21:30 US Personal Income and US Core PCE Deflator, 22:00 remarks by Fed Vice Chair Brainard, 23:00 US University of Michigan Consumer Sentiment Index, 24:00 remarks by Fed Governor Bowman, and 29:15 remarks by US Fed President Williams (NY Fed).We will be closely monitoring currency strength on this final day of the quarter.