EURUSD
- EUR/USD Price: EUR/USD trades steady near 1.1785 during Thursday’s European session, consolidating recent gains as markets await new ECB guidance.
- ECB Policymakers: ECB members Kazaks and Simkus signaled no immediate need for further rate cuts, though they left the door open for potential moves if conditions shift. Their remarks underscore a cautious, data-driven approach.
- Inflation Update: Eurostat confirmed August inflation at 2.0% YoY, slightly revised from 2.1%. Price pressures remain stable for a third consecutive month, aligning with the ECB’s target range.
- ECB Leadership: Vice President Luis de Guindos stressed that current rates are appropriate, given inflation dynamics and effective policy transmission, reinforcing the view that the easing cycle may be at a pause.
- Market Expectations: Traders now lean toward the ECB being finished with rate cuts for the time being, with attention turning to President Christine Lagarde’s speech later Thursday for confirmation or nuance.
| SMA (20) | Slightly Rising |  |
|
| RSI (14) | Rising | | |
| MACD (12, 26, 9) | Rising | | |
Closing statement: The euro holds firm as stable inflation and ECB commentary reduce expectations of further cuts. Near-term direction hinges on Lagarde’s remarks, which could cement or challenge the market’s dovish unwind.
GBPUSD
- GBP/USD Price: GBP/USD dips to 1.3595 in early European trading on Thursday, weighed down by a stronger US Dollar rebound.
- Inflation Data: The UK CPI held steady at 3.8% YoY in August, missing expectations of 3.9%. Headline inflation remains nearly double the BoE’s 2% target, highlighting persistent price pressures.
- Political Angle: The inflation report is politically sensitive for Finance Minister Rachel Reeves, who faces pressure ahead of the November budget. Rising food prices for five straight months could force unpopular tax measures to balance public finances.
- Monetary Policy: Markets broadly expect the BoE to keep rates on hold at 4.0% during Thursday’s policy meeting. Policymakers remain cautious, with inflation still elevated despite signs of moderation.
- Data Ahead: Focus shifts to UK Retail Sales for August due Friday, forecast at +0.4% MoM (headline) and +0.3% (ex-fuel). Stronger prints could lend support to the pound.
| SMA (20) | Slightly Rising | |
|
| RSI (14) | Rising | | |
| MACD (12, 26, 9) | Rising | | |
Closing statement: Sterling is under pressure from a firm USD and sticky UK inflation, leaving the BoE in a wait-and-see mode. The next directional cue may come from Retail Sales data and fiscal signals ahead of Reeves’ November budget.
XAUUSD
- XAU/USD Price: Gold (XAU/USD) extends losses, slipping to around $3,637 on Thursday after briefly touching the $3,672 region earlier in the European session. The move marks a continuation of the retracement from recent record highs.
- Fed Policy: As expected, the Federal Reserve cut rates by 25 bps, lowering the funds rate to 4.00%-4.25%, its first cut since December. The decision signals a gradual easing approach amid uncertain growth conditions.
- Powell’s Remarks: Chair Jerome Powell framed the cut as a “risk management move”, stressing that the Fed does not feel urgency to accelerate further reductions. His cautious stance tempered aggressive rate-cut speculation.
- Dot Plot: The FOMC’s dot plot projects rates at 3.6% by end-2025, down from the 3.9% forecast in June, reinforcing expectations of a slower, measured path to easing.
- Data Watch: Traders now turn to US Initial Jobless Claims and the Philly Fed Manufacturing Index later Thursday, both of which could provide fresh cues on the economy and near-term Fed policy bets.
| SMA (20) | Rising | | |
| RSI (14) | Rising | | |
| MACD (12, 26, 9) | Rising | | |
Closing statement: Gold faces renewed pressure as Fed caution tempers dovish bets, keeping prices below recent highs. Incoming US data will help clarify whether bullion can stabilize or extend its pullback.
CRUDE OIL
- Crude Oil Price: WTI crude oil dips, trading near $63.30 per barrel in early European hours on Thursday, slightly below Wednesday’s close of $63.63, as bearish sentiment dominates the session.
- Economic Outlook: The Federal Reserve’s updated forecasts show growth expectations of 1.6% in 2025, 1.8% in 2026, and 1.9% in 2027, suggesting a moderate long-term trajectory that could weigh on future energy demand.
- Russia Tensions: Russia’s Defense Ministry reported that its forces are advancing across multiple fronts in the Ukraine conflict zone, heightening geopolitical risks with potential implications for global energy supply chains.
- European Stance: German Chancellor Friedrich Merz accused Russia of testing NATO and EU airspace limits, while EC President Ursula von der Leyen called for an accelerated phase-out of Russian gas and oil imports, adding pressure on EU supply dynamics.
- Middle East: The Israeli military’s intensified offensive in Gaza, using booby-trapped armored vehicles to demolish residential areas, has sparked widespread international criticism, raising fears of broader regional instability that could spill into energy markets.
| SMA (20) | Slightly Falling |  |
| RSI (14) | Slightly Rising | |
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: WTI crude trades lower amid economic growth concerns, but escalating geopolitical flashpoints in Russia and the Middle East may inject volatility and upside risks. Traders should watch for supply disruptions or policy responses that could quickly alter price direction.
DAX
- DAX Price: The DAX advanced modestly, closing 0.1% higher at 23,359 points on Wednesday and currently trades around 23,445, reflecting cautious optimism among investors.
- Index Composition: On Thursday, the DAX temporarily expands to 41 members as Aumovio, spun off from Continental, is added for a single trading session to allow index investors an orderly adjustment.
- Fed Policy: Fed Chair Jerome Powell described the latest rate move as a “risk management cut”, stressing it was not a response to economic weakness but a meeting-by-meeting approach, leaving global markets in a reactive stance.
- EU-Israel: The EU is weighing tariffs on Israel and sanctions on extremist ministers to pressure Tel Aviv to halt the 23-month Gaza war, signaling growing political and trade risks.
- Nvidia News: Despite Nvidia’s progress on export licensing in China, Beijing escalated restrictions by ordering Alibaba and ByteDance to cancel chip purchases, underscoring persistent tech and trade frictions.
| SMA (20) | Slightly Falling | |
| RSI (14) | Slightly Falling | |
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: The DAX edges higher amid a unique index reshuffle, but monetary policy ambiguity, EU geopolitical maneuvers, and renewed US-China tech tensions could all weigh on sentiment. Investors should stay alert to external shocks that may disrupt the current cautious gains.
