United States of America

USD is strengthening against EUR and GBP but weakening in pair with JPY.

Investors are preparing for the publication of August statistics on the labor market on Friday: if the uptrend continues, officials may reduce the cost of borrowing more aggressively, but if the forecast of a decrease to 4.2% is implemented, the interest rate correction will be moderate. Today, August data on the Manufacturing PMI from the Institute for Supply Management (ISM) will be presented: the indicator is expected to grow from 46.8 points to 47.5 points, but will remain in the stagnation zone. Thus, the industrial sector will continue to slow down, which satisfies the conditions of the American regulator for easing monetary policy. Recall that at present, most experts expect that the US Federal Reserve will reduce the cost of borrowing three times by a total of 100 basis points by the end of the year.

Eurozone

EUR is weakening against its main competitors – JPY, GBP, and USD.

Investors are following the comments of policymakers at the European Central Bank (ECB) that are to determine the next steps in monetary policy. According to sources, some officials believe that the Eurozone economy looks weaker and the risk of a recession remains as companies are actively cutting their workforce. This, in turn, is having a negative impact on consumption, so the ECB needs to reduce borrowing costs at a faster pace. However, most economists note that actual data has consistently outpaced weak business and consumer surveys, allowing the economy to maintain a stable pace. Further forecasts may be influenced by the publication of July data on the producer price index: YoY, it is expected to be ˗2.5%, confirming the likelihood of an adjustment to monetary parameters at the September meeting.

United Kingdom

GBP is strengthening in pair with EUR but weakening against JPYand USD.

Today, the British Retail Consortium (BRC) published its August retail sales data, which turned out to be positive: the indicator strengthened by 0.8%, exceeding the July value of 0.3%, while the decline in non-food sales was offset by an increase in demand for food. BRC experts explain this situation by good weather, which allowed citizens to relax in the countryside. Positive dynamics indicate the stability of the economy and increase the likelihood that Bank of England (BoE) officials will take a wait-and-see attitude regarding further adjustments to the cost of borrowing. Now, most market participants expect that the regulator will keep the key rate at the current level at the September meeting but will reduce it in November.

Japan

JPY is strengthening against its main competitors – EUR, GBP, and USD.

In the absence of significant economic releases, the yen's movement is due to external factors. It is worth noting that, according to media, Bank of Japan (BoJ) Governor Kazuo Ueda wrote a letter to government officials on Tuesday in which he justified the reasons for the need for an interest rate hike in July, and also stated that the regulator will continue to tighten monetary policy if the economy remains stable and inflation rises as expected. These comments increase the likelihood that the value may be adjusted at least once more before the end of the year.

Australia

AUD is weakening against its main competitors – EUR, JPY, GBP and USD.

Today, the data on the current account balance for the second quarter was published, which turned out to be weak: the deficit increased from 6.3 billion Australian dollars to 10.7 billion Australian dollars. We should also note that the Commonwealth Bank has improved its estimates regarding the dynamics of the country's gross domestic product (GDP) in the current quarter amid a significant increase in consumer spending and now expects the economy to accelerate by 0.4% instead of the previously expected 0.2%, while specialists from the National Australia Bank (NAB) believe that growth will be 0.3% instead of 0.1%.

Oil

Oil prices are actively declining today after the Bloomberg News agency reported on the possible end of the internal political conflict in Libya, which could lead to the restoration of production at the country's leading fields and the introduction of additional large volumes of "black gold" to the market.

Currently, exports from the main ports have not yet resumed, and production, according to the National Oil Corporation (NOC), has fallen from 959.0 thousand barrels per day to 591.0 thousand barrels per day. However, this situation may change soon, since the conflicting political forces in the country are now close to a compromise on the distribution of oil revenues.