The Euro has surged to session highs around 1.1650 versus the US Dollar. This recent surge reflects the market’s reaction to the most recent Consumer Price Index (CPI) report from the US Bureau of Labor Statistics’ release. This contrarian rise occurs against a backdrop of a distinctly bearish demeanor in the US Dollar after a series of mixed inflation figures for July.
On Tuesday, EUR/USD advanced further, revisiting the 1.1650 region after US headline CPI showed an annual increase of 2.7% for July, falling short of economists’ expectations. Tamed inflation, and possibly some damage Core CPI recently rose just 3.1% over the same month a year ago. This increase, without the volatile food and energy prices, was above consensus forecasts.
With inflation data still being a major driver of market dynamics, the US Dollar’s performance has been weak. Patrons and speculators have been dispassionately buying and selling against the formation of these numbers. Perhaps more importantly, they are watching a number of economic indicators that might force the Federal Reserve’s hand on additional easing.
Gold has had a violent reaction to all of this inflation news. On Tuesday, it built up some bullish momentum and retested the $3,350 zone per troy ounce. This soaring trend further emphasizes the metal’s attractiveness as a safe haven during volatility in the currency markets.
Taxi service up British Pound jumps over 1.3500 against US Dollar, GBP/USD climbs more than 2% to over 7 month highs. This increase is driven by new bearish sentiment on the Dollar. The GBP/USD pair’s movement reflects broader trends influenced by US economic data and traders’ sentiments regarding potential shifts in monetary policy.
Traders are looking for clues in economic data. They’re getting ready for the next sit down between former President Donald Trump and Russian President Vladimir Putin. The expected meeting could add to the already prevalent bearish market sentiment and influence trading strategies.