Forex Today: Caution is poised to increase ahead of US CPI

The US Dollar added to Friday’s strong recovery despite US yields trading mostly on the back foot, all against the backdrop of steady expectations of a rate cut by the Fed later in the month.

Here is what you need to know on Tuesday, September 10:

The US Dollar Index (DXY) rose to three-day tops near 101.80 as investors priced in a 25 bps rate cut as the most likely scenario at the Fed’s next meeting. The NFIB Business Optimism Index is due on September 10 along with the API’s weekly report on US crude oil supplies.

EUR/USD succumbed once again to the upbeat tone in the Greenback, approaching to recent lows around the 1.1030 zone. The final Inflation Rate in Germany will take centre stage on September 10.

Further weakness saw GBP/USD retreat to three-week lows near 1.3070 following the intense recovery in the US Dollar. On September 10 comes the publication of the significant UK’s labour market report.

USD/JPY set aside a four-day negative streak and flirted with the 144.00 region on the back of the strong move higher in the Greenback. Next on tap on the Japanese calendar will be the speech by the BoJ’s Nakagawa on September 11.

AUD/USD traded in a volatile fashion and ended the day with humble losses around 0.6660. The Westpac Consumer Confidence is expected on September 10, seconded by the NAB Business Confidence, final Building Permits and final Private House Approvals.

The resurgence of supply disruptions concerns seem to have temporarily offset Chinese demand jitters, helping prices of WTI regain some composure and advance to the vicinity of the $69.00 mark per barrel.

Gold prices rose modestly on Monday, leaving behind part of recent losses and regaining the area beyond the key $2,500 mark per ounce troy. Silver prices followed suit despite the stronger US Dollar and reclaimed the $28.00 mark per ounce and above.