Market participants are keeping a close eye on the euro-dollar exchange rate, which failed to sustain its rebound and has slipped back into a downtrend.

Market participants are keeping a close eye on the euro-dollar exchange rate, which has failed to sustain its rebound and has slipped back into a downtrend.

02.10.2023

Last weekend, the Canadian dollar became the weakest currency in the U.S. market after Canada’s July GDP, released on September 29, came in at 0.0% month-over-month—below the market forecast of 0.2%. The CAD/JPY pair plummeted after hitting a new year-to-date high of 111.167.It fell by approximately 120 pips to 1019.940. Due to last weekend’s decline, the CAD/JPY pair has broken below its 10-day moving average. We will closely monitor the direction of the CAD/JPY pair at the start of the month.

European currencies came under pressure during U.S. trading hours as the final reading of the Eurozone’s September Harmonized Index of Consumer Prices (HICP) fell to 4.3% year-over-year from the previous reading of 5.2%. Although the euro/dollar pair rebounded during Asian trading hours, it lost momentum during U.S. trading hours, falling back from 1.0616 to 1.0564.Technically, while the pair has returned above the 20-period moving average (MA) on the 4-hour chart, it continues to trade below the 20-period MA on the daily chart. Therefore, traders should monitor whether the downward trend in the EUR/USD pair will continue.

Today’s schedule includes the UK Nationwide House Price Index at 3:00 PM, Swiss Retail Sales at 3:30 PM, Turkey Manufacturing PMI at 4:00 PM, France Manufacturing PMI at 4:50 PM, Germany Manufacturing PMI at 4:55 PM, Eurozone Manufacturing PMI at 5:00 PM, UK Manufacturing PMI at 5:30 PM, and EurozoneEmployment Report, at 22:45 the US Manufacturing PMI, at 23:00 US Construction Spending and the US ISM Manufacturing Index, at 24:00 remarks by Fed Chair Powell and remarks by Harker, President of the Philadelphia Fed, and at 24:30 a US 6-month Treasury bill auction.We will closely monitor the price movement of the euro/dollar, which has failed to sustain its rebound and has slipped back into a downtrend.