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Forex Today: Dollar continues to weaken ahead of key inflation data

This is what you need to know to trade today tuesday september 13:

The dollar is having a hard time bouncing on Tuesday, with the DXY dollar index trading in negative territory near 108.00 at the start of the European session. The US Bureau of Labor Statistics will release data from the consumer price index CPI for august later in the session, as markets almost fully anticipate another 75 basis point Fed rate hike in September. The ZEW sentiment survey for the euro zone and Germany will be published on the European economic docket.

See: US CPI Preview: Dollar to Rise on Low Core Inflation Expectations – Three Scenarios

The observed positive change in risk sentiment it did not allow the dollar to hold its own against its rivals. Markets are turning bullish on the possibility that US inflation has peaked and the latest news about the war between Russia and Ukraine point to Ukraine is succeeding in its counteroffensive. US Secretary of State Antony Blinken said late on Monday that Ukrainian forces have made “significant progress” and argued that Russia could and should stop the war given the price they are paying. US stock index futures are up 0.4-0.5%, suggesting that Wall Street’s main indices could continue to rise after gaining more than 1% on Monday.

On Monday, the pair EUR/USD it posted its highest daily close in three weeks above 1.0100 and continued to rise early on Tuesday. The pair is now trading in positive territory near 1.0150. Comments from European Central Bank officials help the common currency maintain its position.

The GBP/USD closed for the second day in a row in positive territory and advanced above 1.1700 on Tuesday. Sterling is benefiting from risk-on currency flows and the UK’s FTSE 100 index is modestly higher after the opening bell.

Despite the general weakness of the dollar, the pair USD/JPY struggled to find direction as the Japanese yen fails to attract investors in a risk-friendly market environment. The pair remains lower early on Tuesday and is now down 0.3% on the day at 142.25.

The Prayed it hit a new September high of $1,735 on Monday but struggled to gain further momentum as the 10-year US Treasury yield held relatively steady at around 3.3%. XAU/USD is trading above $1,720 so far on Tuesday.

The Bitcoin it recovered $22,000 on Monday before entering a consolidation phase on Tuesday. The ethereum lost nearly 3% on Monday and is now trading relatively quietly near $1,700.

Source: Fx Street

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