Forex Today: Markets remain cautious on a quiet day for the calendar

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This is what you need to know to trade today monday september 12:

Market action remains subdued to start the week as investors refrain from making big bets. The Dollar Index, which lost 0.6% on Friday, remains on the defensive in European morning after opening with a bearish gap. US stock index futures are trading virtually unchanged with the 10-year US Treasury yield posting small daily gains of around 3.3%. Macroeconomic data of great impact on the economic calendar will not be published on Monday. Market participants will closely watch comments from European Central Bank (ECB) officials and the 10-year US Treasury bond auction that will take place later.

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Ahead of the weekend, several FOMC policymakers reiterated that they believe it is appropriate to continue to remove monetary policy easing. “I support another significant hike in two weeks,” Federal Reserve Governor Christopher Waller said on Friday, but the dollar failed to finish the week on firm footing. However, the CME Group’s FedWatch tool shows that markets value the probability of a 75 basis point (bp) rise in interest rates at 90%.

The EUR/USD It snapped a three-week losing streak on Friday and maintained its bullish momentum early on Monday. The pair is trading with strong daily gains above 1.0100. The latest comments from officials revived expectations of a further 75 basis point hike in October. Additionally, multiple media outlets reported that the bank is planning to start discussing quantitative tightening in October, allowing the common currency to continue to gain strength.

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The GBP/USD It broke above 1.1600 and continued to rise towards 1.1650 early on Monday. UK data revealed that Gross Domestic Product expanded by 0.2% monthly in July. This reading was weaker than market expectations for 0.5% growth. Other data showed that industrial production contracted 0.3% and manufacturing increased only 0.1% in the same period. Despite the disappointing data, the pair is holding on to its daily gains amid broad selling pressure surrounding the dollar.

After Friday’s deep downward correction, the USD/JPY is rising early on Monday, trading above 143.00. Japanese Deputy Cabinet Secretary Seiji Kihara urged the government to take necessary steps to counter the yen’s excessive depreciation, but this comment did not help the currency hold firm against the dollar.

The Prayed ended up closing the previous week with small gains. With US yields moving up and down in tight ranges on Monday, XAU/USD is having a hard time finding direction as it fluctuates near $1,720.

The Bitcoin It continued to rise over the weekend and broke above $22,000 on Monday before pulling back to the $21,800 area. ethereum it hit its highest level in three weeks near $1,800 but lost its upside momentum. ETH/USD closed in negative territory on Sunday and was last seen losing nearly 2% on the day at $1,735.

Source: Fx Street

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