Here’s what you need to know on Monday, September 30:
He US dollar (USD) is struggling to find demand entering the last trading day of the third quarter. In the first half of the day on Monday, investors will pay close attention to the German Consumer Price Index data. Later in the American session, several Federal Reserve policymakers, including Chairman Jerome Powell, will deliver speeches.
The USD Index turned south on Friday and hit its weakest level in over a year at 100.15, before making a technical correction towards the end of the week. The US Bureau of Economic Analysis reported that the core Personal Consumption Expenditure (PCE) Price Index rose 0.1% monthly in August, at a softer pace than the market expectation of 0.2% . Early on Monday, the USD Index remains below 100.50. Powell will participate in a moderated discussion titled “A View from the Federal Reserve Board” at the National Association of Business Economics Annual Meeting, in Nashville, starting at 17:00 GMT. Fed Governor Michelle Bowman is also scheduled to speak at the first American session. Meanwhile, US stock index futures are trading marginally lower on the day.
US Dollar PRICE Last 7 days
The table below shows the percentage change of the United States Dollar (USD) against the main currencies in the last 7 days. US dollar was the weakest currency against the New Zealand dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.01% | -0.50% | -1.38% | -0.40% | -1.84% | -2.08% | -0.95% | |
| EUR | 0.01% | -0.55% | -1.33% | -0.37% | -1.88% | -2.05% | -0.95% | |
| GBP | 0.50% | 0.55% | -0.72% | 0.17% | -1.34% | -1.52% | -0.41% | |
| JPY | 1.38% | 1.33% | 0.72% | 1.00% | -0.55% | -0.69% | 0.32% | |
| CAD | 0.40% | 0.37% | -0.17% | -1.00% | -1.40% | -1.69% | -0.58% | |
| AUD | 1.84% | 1.88% | 1.34% | 0.55% | 1.40% | -0.16% | 0.95% | |
| NZD | 2.08% | 2.05% | 1.52% | 0.69% | 1.69% | 0.16% | 1.12% | |
| CHF | 0.95% | 0.95% | 0.41% | -0.32% | 0.58% | -0.95% | -1.12% |
The heat map shows percentage changes for major currencies. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you choose the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change shown in the box will represent USD (base)/JPY (quote).
China data on Monday showed the Caixin manufacturing PMI fell to 49.3 in September from 50.4 in August, while the Caixin services PMI fell to 50.3 from 51.6. Over the weekend, Bloomberg reported that the People’s Bank of China (PBOC) plans to tell banks to reduce mortgage rates for existing home loans by October 31 in its latest attempt to shore up the troubled real estate sector as the economy slows down. Meanwhile, the ANZ Business Confidence Index in Australia improved to 60.9 in September from 50.6 in August. AUD/USD rose as the new week began and the pair was last seen trading at its highest level since February 2023 above 0.6900.
The United Kingdom’s Office for National Statistics announced early Monday that it revised down annualized gross domestic product (GDP) growth for the second quarter to 0.7% from the 0.9% reported in the advanced estimate. GBP/USD holding on to modest daily gains, slightly below 1.3400 following this data.
After falling sharply and losing more than 1.5% in one day on Friday, USD/JPY continues to decline towards 142.00 early Monday. Following reports from several Japanese media outlets over the weekend, Japan’s next Prime Minister (PM), Shigeru Ishiba, proposed October 27 for an early election. If an early election is confirmed for the end of October, parliament is likely to be dissolved before October 9.
EUR/USD remains relatively calm in the first European session and fluctuates in a narrow channel above 1.1150.
After setting a new all-time high above $2,680 on Thursday, the gold posted modest losses on Friday. XAU/USD remains firm and trades in a tight range above $2,650 early on Monday.
The Fed FAQs
The monetary policy of the United States is directed by the Federal Reserve (Fed). The Fed has two mandates: achieving price stability and promoting full employment. Your main tool to achieve these objectives is to adjust interest rates. When prices rise too quickly and inflation exceeds the Federal Reserve’s 2% target, it raises interest rates, raising borrowing costs throughout the economy. This translates into a strengthening of the US Dollar (USD), as it makes the United States a more attractive place for international investors to place their money. When inflation falls below 2% or the unemployment rate is too high, the Federal Reserve can lower interest rates to encourage borrowing, which weighs on the greenback.
The Federal Reserve (Fed) holds eight meetings a year, in which the Federal Open Market Committee (FOMC) evaluates the economic situation and makes monetary policy decisions. The FOMC is made up of twelve Federal Reserve officials: the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the eleven presidents of the regional Reserve banks, who serve for one year on a rotating basis.
In extreme situations, the Federal Reserve can resort to a policy called Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit into a clogged financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis of 2008. It involves the Fed printing more dollars and using them to buy high-quality bonds from financial institutions. QE usually weakens the US dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the capital of the maturing bonds it has in its portfolio to buy new bonds. It is usually positive for the value of the US Dollar.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
