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EUR/USD hits 1-month low before FOMC

I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful. – Warren Buffett

 

 

HEADLINES

 

 

  • Dollar touches three-week high, lifted by recent data, Fed taper view
  • EUR/USD hits fresh monthly lows, attention turns to FOMC meeting next week
  • Gold futures fall a third straight session to lose over 2% for the week
  • Oil prices decline, but post a 4th straight weekly gain
  • Wall Street slips on tech losses, tax uncertainty weighs
  • European shares fall for third week in a row, miners worst hit
  • Fed unlikely to formally announce tapering next week – NFB

 

 

FOREX

 

 

Dollar touches three-week high, lifted by recent data, Fed taper view

 

The dollar scaled three-week peaks on Friday, supported by better-than-forecast U.S. retail sales data released on Thursday that backed expectations for a reduction of asset purchases by the Federal Reserve before the end of the year. For the week, the dollar index gained 0.6%, its largest weekly percentage rise since mid-August.

 

EUR/USD hits fresh monthly lows, attention turns to FOMC meeting next week

 

EUR/USD keeps sliding for the second day in a row, exchanging hands at 1.1728 down 0.30% on the day at the time of writing. After a stellar US Retail Sales report on Thursday, the EUR/USD pair is trading at three-week lows, on broad US dollar strength. During the European session, the Eurozone Core Consumer Price Index (YoY) rose by 1.6%, in line with expectations. Meanwhile, the Core CPI for August (MoM) edged higher 0.3% as foreseen.

 

 

COMMODITIES

 

 

Gold futures fall a third straight session to lose over 2% for the week

 

Gold futures ended lower on Friday, with prices tallying a third consecutive session loss and a second weekly decline in a row, as the U.S. dollar strengthened ahead of the Federal Reserve’s policy meeting next week. Bullion also marked a second straight weekly drop, down 2.3% for the week. That was its first successive weekly fall since the three-week period ended June 18, FactSet data show. A better-than-expected report on U.S. August retail sales on Thursday was partially credited with boosting the dollar and weakening bullion.

 

Oil prices decline, but post a 4th straight weekly gain

 

Oil futures declined on Friday, pulling back from seven-week highs as crude production in the Gulf of Mexico makes a slow comeback from Hurricane Ida, but U.S. and global benchmark crude prices scored solid weekly gains for a fourth week in a row.

 

 

STOCKS

 

 

Wall Street slips on tech losses, tax uncertainty weighs

 

U.S. stock indexes slipped on Friday led by major technology firms, while uncertainty over higher corporate taxes and an upcoming Federal Reserve meeting also weighed on sentiment. The Nasdaq (.IXIC) was the worst performer among the main U.S. indexes and was set for its worst day since late July as a batch of strong economic readings encouraged investors to pivot into economically sensitive sectors and out of tech this week.

 

European shares fall for third week in a row, miners worst hit

 

European stocks fell on Friday, capping their third straight week in the red as the basic resources sector was hit by declines in Anglo American, but news that Britain was mulling easing travel restrictions boosted airlines and hotel groups.

 

 

ANALYSIS

 

 

Fed unlikely to formally announce tapering next week – NFB

 

“While an official announcement isn’t expected to be in the cards, look for the Fed chair to continue to pre-emptively break down any perceived links between the timing of the taper and rate hikes. On inflation, we expect the transitory narrative to be prevalent once again, both in the statement and press conference. Finally, the statement will also be released alongside a fresh Summary of Economic Projections. While June’s SEP saw growth projections upgraded and rate hikes moved into 2022, we don’t expect the same momentum this month.”

 

 

CHART

 

 

Euro / US dollar – Daily Candlesticks

Source: GKFX Prime Metatrader 4

EUR/USD is testing the neckline of a double top pattern on the weekly chart. The second move below a rising trendline suggests a break lower. - Prepared by Trading Writers*

 

 

CALENDAR

 

 

*Times in GMT

Source: FX Street Economic Calendar

 

 

SOURCE

 

 

https://www.fxstreet.com/economic-calendar
https://www.fxstreet.com/news/fed-unlikely-to-formally-announce-tapering-next-week-nfb-202109171630
https://www.fxstreet.com/news/eur-usd-hits-fresh-monthly-lows-attention-turns-to-fomc-meeting-next-week-202109171818
https://www.reuters.com/business/futures-dip-tech-weakness-treasury-yields-steady-2021-09-17/
https://www.reuters.com/article/europe-stocks/european-shares-fall-for-third-week-in-a-row-miners-worst-hit-idUSKBN2GD0JQ
https://www.marketwatch.com/story/gold-futures-inch-higher-but-head-for-second-weekly-loss-in-a-row-11631881326
https://www.marketwatch.com/story/oil-prices-edge-lower-but-on-track-for-weekly-rise-of-more-than-3-11631880088
https://www.marketwatch.com/story/oil-prices-edge-lower-but-on-track-for-weekly-rise-of-more-than-3-11631880088
https://www.reuters.com/business/dollar-holds-near-three-week-high-after-us-retail-sales-boost-2021-09-17/

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