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25.01.2024 Market Report


EUR/USD gathered bullish momentum and advanced to the 1.0930 area on Wednesday. With the US Dollar (USD) staging a rebound later in the day, the pair erased a large portion of its daily gains and returned below 1.0900. Investors await the European Central Bank’s (ECB) policy announcements and high-tier data releases from the US.


GBP/USD experiences a downward trend, following the pullback from a recent two-week high at 1.2774 on Wednesday. During the European session on Thursday, the pair trades lower near 1.2710. 


USD/JPY heads into the Thursday market session trading near 147.50 after shedding the 148.00 handle on Wednesday. The pair has churned in a rough bearish pattern since peaking near 148.50 last week. The Bank of Japan (BoJ) remained firmly planted in their dovish monetary policy stance on Tuesday, dedicated to keeping interest rates in negative territory until the Japanese central bank sees enough evidence that inflation in Japan’s domestic economy won’t drop too far below 2% in the future.


The Australian Dollar (AUD) registers minuscule losses against the US Dollar (USD) as Thursday’s Asian session begins; on Wednesday, the pair ended the session virtually unchanged, closing below the 0.6600 figure on upbeat US economic data. The AUD/USD trades at 0.6576.


The NZD/USD pair attracts some buyers for the third straight day on Thursday and for now, seems to have stalled the previous day’s pullback from the vicinity of mid-0.6100s, or over a one-week high. Spot prices manage to hold above the 0.6100 round-figure mark during the Asian session, though the lack of any follow-through buying warrants some caution for bulls ahead of the crucial US macro data.


USD/CAD makes an effort to not capitalize on the recent gains after the interest rate decision from the Bank of Canada (BoC) on Wednesday. Additionally, the positive S&P Global Purchasing Managers Index (PMI) data from the United States (US) might have contributed to reducing the probability of rate cuts by the Federal Reserve (Fed) in March, leading to an appreciation in the USD/CAD pair. However, the spot price hovers near 1.3520 during the Asian session on Thursday.


USD/CHF moves lower to near 0.8650 during the Asian session on Thursday, retracing its losses registered in the previous session. The US Dollar Index (DXY) maintains a steady position despite the downbeat US Treasury yields, which underpins the USD/CHF pair. The DXY hovers near 103.30 with the 2-year and 10-year yields on US bond coupons standing at 4.36% and 4.14%, respectively, by the press time.


Oil prices rose on Thursday after data showed U.S. crude stockpiles fell more than expected last week, while the Chinese central bank’s cut in banks’ reserve ratio reinforced hopes of more stimulus measures and economic recovery.


Gold price ticks higher on Thursday and reverses a part of the previous day’s heavy losses to a multi-day low, albeit it lacks bullish conviction. Reduced bets for an early Fed rate cut act as a tailwind for the buck and should cap gains.

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