United States of America

USD is declining today in pairs with EUR and GBP but has positive dynamics with JPY.

The dollar is losing ground amid expectations of a cut in the US Federal Reserve key rate at tomorrow's meeting. Today, according to the Chicago Mercantile Exchange (CME) FedWatch Tool, the probability of a minimum reduction in borrowing costs by 25 basis points is 35.0%, while a correction of 50 basis points is supported by 65.0% of respondents. Tomorrow, data on the real estate market will also be published, which may influence the decision of the American regulator: the number of permits for the construction of new homes may amount to 1.410 million, which is almost identical to the July figure, and the volume of new housing construction may increase from 1.238 million to 1.310 million, which, if the forecast is confirmed, will become the basis for a more aggressive reduction in borrowing costs.

Eurozone

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

Macroeconomic statistics are preventing more active growth of quotes: so, according to the forecast of the Center for European Economic Research (ZEW), the index of current economic conditions in Germany in September may fall from ˗77.3 points to ˗84.5 points, the lowest value since May 2020. The index of economic sentiment for the same period may adjust from 19.2 points to 3.6 points and approach the red zone for the first time since October 2023. Similar values are demonstrated by the indicator of economic sentiment in the EU, which fell from 17.9 points to 9.3 points. Against the background of these statistics, investors' confidence in the EU economy to receive support from lower interest rates and begin active growth is decreasing.

United Kingdom

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

Tomorrow, consumer price and retail sales data will be published, which may influence the Bank of England's monetary policy decision, which will be made a day later. Most analysts assume that inflation will not change, and in basic terms it will even increase from 3.3% to 3.5%, in connection with which the British regulator may keep the key rate at 5.00%. Nevertheless, about 37.0% of experts support the likelihood of a correction in the cost of borrowing.

Japan

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

The yen has been falling since the start of trading, despite the publication of positive macroeconomic reports: for example, the Services PMI in July grew by 1.4% from ˗1.2% earlier, but investors' attention is now focused on the actions of the Bank of Japan (BoJ) and the US Federal Reserve, since it was the difference in monetary policy that led to a significant strengthening of the yen. Yesterday, it became known that experts are inclined to think that the US Fed will reduce the interest rate by 50 basis points, and not 25 basis points, as previously expected. This is a negative scenario for the Japanese currency, since the difference in the cost of borrowing will be reduced too quickly, and to maintain balance, the BoJ will need to leave interest rates unchanged.

Australia

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

The Reserve Bank of Australia (RBA) meeting is scheduled for September 24, and until then the regulator will have time to assess the actions of all other developed country regulators that hold their meetings earlier. Also, this week, labor market data for August will be published: analysts expect unemployment to remain at 4.2%, against the backdrop of employment growth by 25.8 thousand jobs after 58.2 thousand in July. If the statistics are neutral or positive, the RBA will have the opportunity to even cut the key rate by 0.25%, but so far forecasts indicate that the regulator will keep it at 4.35%.

Oil

Oil prices are stable today and are holding just above the 72.0 dollars per barrel mark.

Even though OPEC countries agreed to postpone the minimum increase in production by 180.0 thousand barrels per day from October to December, this had virtually no effect on quotes due to the slowdown in the Chinese economy and instability in the Middle East. In this situation, the cartel may lose the ability to influence prices, since the current restrictions are almost the maximum for the organization, and further production cuts may lead to a loss of market share. Thus, most likely, until new data on oil reserves from the US is received and the demand situation in China improves, quotes will remain at the same levels.