United States of America

USD is weakening against EUR and GBP but is ambiguous against JPY.

Investors focus on the publication of August labor market data. Employment increased by 142.0K, less than the forecast of 164.0K, and the construction (34.0K) and health care (31.0K) sectors increased the most. However, unemployment changed from 4.3% to 4.2%, meeting expectations, and average hourly earnings – by 0.4% instead of the calculations of 0.3%. Contradictory statistics failed to clarify the further actions of the US Fed, which many market participants were hoping for. Most experts are inclined to believe that officials will take a cautious stance and begin the cycle of adjusting the cost of borrowing from –25 basis points.

Eurozone

EUR is strengthening against USD, weakening against GBP, and ambiguous against JPY.

The Q2 EU gross domestic product (GDP) increased by 0.6% QoQ, in line with forecasts, and by 0.2% instead of the expected 0.3%. German industrial production fell by 2.4% in July, beating preliminary estimates, amid poor activity in the German auto sector, which fell by 8.1%, raising concerns about the country’s economy weakening in the third quarter. German goods exports changed by 1.7%, compared to the expected 1.2%, and imports by 5.4%, compared to 0.3%. As a result, the trade surplus changed from 20.4M euros to 16.8M euros, putting pressure on the single currency.

United Kingdom

GBP is strengthening against EUR and USD but is ambiguous against JPY.

Halifax Bank Plc.’s August house price data was released today. It slowed from 0.9% to 0.3% MoM, above the forecast of 0.2%, and from 2.4% to 4.3% YoY, growing at the fastest pace since late 2022 and confirming the recovery of the construction market after the Bank of England began cutting interest rates. The agency’s experts expect further increases in property prices before the end of the year amid further easing of monetary policy.

Japan

JPY is ambiguous against EUR, GBP, and USD.

Japanese household spending data for July was released today, down 1.7% MoM versus the expected 0.2%, and up 0.1% YoY versus the 1.2% estimate. Consumers remain cautious amid high retail prices, which could complicate the Bank of Japan’s plans to tighten monetary policy further. However, most experts still expect the regulator to raise borrowing costs at least once more before the end of the year.

Australia

AUD is weakening against GBP and has ambiguous dynamics against EUR, JPY, and USD.

Home lending rose 2.9%, beating expectations of 1.0%, while property investment rose 5.4%, reflecting the resilience of the housing sector amid the Reserve Bank of Australia’s (RBA) tight monetary policy. However, its position may worsen in the event of a new increase in interest rates, which the head of the regulator Michelle Bullock had previously warned about.

Oil

Oil prices are trying to grow, under the influence of several opposing factors.

The sector is supported by the weekly report of the Energy Information Administration of the US Department of Energy (EIA) on oil reserves. Commercial oil volumes fell by 6.873M barrels instead of the expected 0.600M barrels, distillates – by 0.371M barrels, and only gasoline reserves increased by 0.848M barrels. On the other hand, positive dynamics are hampered by August statistics from the US labor market. Against a decrease in unemployment from 4.3% to 4.2%, US Fed officials can adjust the interest rate only by –25 basis points instead of –50 basis points.