CPI

Showcasing the GBP strength is the struggling EUR/GBP. With the latter testing the 0.82 support area, sterling is therefore trading at its best levels since March 2022 against the euro. But against the dollar, it has been held back. In fact, I reckon there is a good chance we may see the GBP/USD start to head lower again and may even go on to break 1.2500 support, once UK’s services inflation eases more significantly - possibly in early next year. If seen, that would allow the BoE to turn more dovish. So, the GBP/USD outlook remains bearish heading into 2025.

EURUSD, DXY Forecast: the final reports for the economic calendar’s major events, including the US CPI and FOMC meeting, are due between today and next Wednesday, setting 2024’s final volatility wave ahead of the holidays and 2025’s narrative.

USD/JPY rallies to a fresh monthly high (152.18) ahead of the update to the US Consumer Price Index (CPI).

The Fed is likely to cut interest rates by 25bps regardless of the CPI reading, though a hotter-than-expected print could certainly raise some questions for USD/CAD

USDJPY, Dow, Nasdaq Analysis: With forecasts pointing to an uptick in US inflation rates and overbought conditions in US indices, a critical wave of volatility is anticipated ahead of the holidays.

Ahead of key macro events, the EUR/USD forecast remains modestly bearish, although the currency pair has found some love today thanks to optimism about more stimulus measures being introduced in China, one of the Eurozone’s major exports destinations.

GBPUSD, Gold Analysis: As we approach the final central bank decisions for 2024 from the Fed, BOJ, and BOE, major reforms in the Middle East are adding layers of volatility to the US Dollar and haven assets ahead of the holidays.

Crude Oil Week Ahead: The bearish outlook on oil prices for 2025 is colliding with significant Middle Eastern reforms. OPEC’s decision to extend its output cuts into 2025 has stabilized oil prices near their 4-year support zone, which will be tested this week by Chinese economic data, US inflation reports, and Middle East developments.

Dow Jones Forecast: With renewed market optimism across indices, cryptocurrencies, and the US dollar following Trump’s win, the Dow Jones is hitting record highs, prompting analysis of potential upcoming resistance levels and the sustainability of this bullish momentum.

Crude Oil Week Ahead: With volatility still restrained post-US election and FOMC week, crude oil markets remain poised for a potential breakout as key events from OPEC, the IEA, and economic data from China and the US are on the horizon. The longer the price remains within this tight range, the more significant any upcoming breakout may be.

EUR/USD trades near the monthly low (1.0683) as it gives back the advance following the Federal Reserve rate-cut.

EUR/USD may further retrace the decline from the start of the month as the Relative Strength Index (RSI) continues to recover from oversold territory.

With the US dollar momentum gathering pace, the risks remain skewed to the downside in so far as the short-term GBP/USD outlook is concerned. The greenback is likely to remain supported as we near the US presidential election, partly because the market will want to factor in a potential win for Donald Trump, as the national lead in the polls that Kamala Harris had enjoyed has been shrinking in recent days.

Canada’s CPI is projected to slow for the fourth consecutive month in September, with the headline reading seen falling to 1.8% from 2.0% per annum in August.

EURUSD, DXY Forecast: The EURUSD is facing bearish pressure as it approaches the US CPI report and next week's ECB monetary policy decision. Critical support levels are near, which will decide whether the pair extends its downward trend or rebounds for a potential bullish continuation.

The Fed has shifted its focus to employment data, but after a stellar jobs report, could CPI pick up again?

USD/JPY appears to be defending the advance following the better-than-expected US NFP report as it bounces back from a fresh weekly low (147.35).