Forex Today: BoE rate decision, employment-related US data to ramp up volatility
Here is what you need to know on Thursday, August 7:
Markets remain cautious on Thursday as they assess the latest news surrounding the US trade regime, while waiting for the Bank of England's (BoE) monetary policy announcements. Later in the day, the US economic calendar will feature weekly Initial Jobless Claims data alongside Unit Labor Costs for the second quarter.
The US Dollar (USD) came under bearish pressure on Wednesday after United States (US) President Donald Trump delivered news regarding tariffs. Trump issued an executive order imposing an additional 25% tariff on Indian imports and said that he could impose an extra 25% tariff on Chinese goods over China's purchases of Russian oil. Additionally, he said that he will impose a 100% tariff on semiconductors and chips, but not for companies that are building in the US, and threatened an extra 15% tariff on all Japanese imports. After posting marginal gains on Monday and Tuesday, the USD Index turned south and lost more than 0.5% on Wednesday. The index stays relatively calm and fluctuates above 98.00 in the European morning on Thursday.
US Dollar PRICE This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the weakest against the Australian Dollar.
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
The BoE is widely anticipated to lower the policy rate by 25 basis points (bps) to 4% after the August meeting. After announcing the rate decision, BoE Governor Andrew Bailey will deliver the policy statement and respond to questions in a press conference starting at 11:30 GMT. GBP/USD stays in a consolidation phase above 1.3350 after rising more than 0.4% on Wednesday.
During the Asian trading hours, the data from China showed that the Trade Surplus declined to $98.24 billion in July from $114.77 billion in June. On a yearly basis, Exports rose by 7.2% in this period, while Imports increased by 4.1%. AUD/USD holds its ground in the European morning and trades in positive territory above 0.6500.
EUR/USD gathered bullish momentum and rose more than 0.7% on Wednesday. The pair continues to stretch higher toward 1.1700 in the European session on Thursday.
USD/JPY trades marginally lower near 147.00 on Thursday after posting small losses on Wednesday.
Gold struggles to find direction and extends its sideways grind above $3,370 following a spike toward $3,400 during the Asian trading hours.
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