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market analysis
The US dollar index remains volatile, and the market focuses on U.S. inflation data
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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Market Analysis]: The US dollar index remains volatile, and the market focuses on US inflation data." Hope it will be helpful to you! The original content is as follows:
On Wednesday, the US dollar index hovered below the 98 mark, and the US dollar rose against most currencies except the yen on Tuesday, regaining lost ground in the previous trading day, and investors consolidated their positions before the release of this week's key inflation report. The U.S. Producer Price Index (PPI) will be released on Wednesday and the Consumer Price Index (CPI) will be released on Thursday. The market will focus on these data to measure the impact of tariffs on prices in the world's largest economy.
Analysis of major currencies
Dollar: As of press time, the US dollar index hovered around 97.83, and the US dollar fell intraday on Tuesday. A previously released report showed that between April 2024 and March 2025, the number of jobs created by the US economy was nearly 1 million lower than the government's previous estimates, indicating that during the 12-month period, the labor market conditions were far weaker than the level shown by preliminary data. However, the correction of employment data has basically no impact on the market. Technically, the US dollar index currently presents a xmaccount.complex technological pattern. After experiencing a significant fluctuation in the previous period, the price has now formed a consolidation trend around 97.25. Judging from the K-line pattern, there have been many cross-star patterns recently, reflecting that the market has a large difference between bulls and bears, and the direction choice is still brewing. The key resistance level is near the previous high of 100.2599, while the important support level is at the 96.3729 level.
1. U.S. employment data has been significantly revised down, with a decrease of 911,000 jobs as of March
The U.S. government said on Tuesday that in the 12 months to March, the U.S. economy may have 911,000 fewer new jobs than previously estimated, indicating that employment growth has shown signs of stagnation before Trump imposed tough tariffs on imported goods. Economists have previously expected that the Bureau of Labor Statistics (BLS), a subsidiary of the U.S. Department of Labor, may reduce employment levels by 400,000 to 1 million jobs from April 2024 to March 2025. Previously, from April 2023 to March 2024The industry level has been lowered by 598,000 jobs. The benchmark revision follows another piece of news released last Friday, with job growth almost stagnating in August, while June saw job losses for the first time in four and a half years. In addition to being dragged down by trade policy uncertainty, the labor market is also under pressure from the White House to tighten immigration policies, which weakens the labor supply. At the same time, xmaccount.companies are turning to artificial intelligence tools and automation, which is also curbing the demand for labor. Economists believe that the downgrade in employment growth data has little impact on monetary policy. The Fed is expected to resume rate cuts next Wednesday after suspending a loose cycle in January due to uncertainty over tariffs.
2. Trump: Israel launches an attack in Qatar not my decision
U.S. President Trump said that this morning, the Trump administration received a notice from the US military that Israel is attacking Hamas in Doha, Qatar. This decision was made by Prime Minister Netanyahu, not by me. Unilateral bombing in Qatar will not help the United States achieve its own goals. I immediately instructed the Special Envoy Steve Witkov to inform Qatar of the upcoming attack, and Witkov did do so; but unfortunately, the notice was too late and failed to prevent the attack. I think this unfortunate event may be an opportunity to achieve peace. In addition, I also spoke to the Emir of Qatar and the Prime Minister and assured them that such incidents will never happen again on Qatar territory. I have instructed Secretary of State Rubio to finalize a defense cooperation agreement with Qatar.
3. EU officials: EU member states are in disagreement over sanctions against Israel and cannot take action
On September 9, local time, EU High Representative for Foreign Affairs and Security Policy, Karas, said in a debate at the plenary meeting of the European Parliament that the European xmaccount.commission is preparing to suspend trade relations with Israel and terminate research partnerships, but governments are hindering further measures. She said, "The option for the EU to take further action is clear and is still under discussion, but member states have differences on how to make the Israeli government change its course. We as a coalition cannot act unless the member states agree on the action."
4. Republican lawmakers: Milan may not catch up with the Fed's meeting next week
The personnel case of Trump's nomination for Milan as Fed director is expected to clear a key obstacle in the Senate on Wednesday, but lawmakers said it may still be too late to let Milan catch up with the vote for the Fed meeting next week. "I think it will be very challenging," said Sen. Loomis, a Republican, of the Senate Finance xmaccount.committee, when she talked about whether the Milan appointment will be able to obtain the logistics of confirming before the Fed's meeting in September. She referred to Republicans who are seeking possible changes to the nomination process. The Financial xmaccount.committee is expected to vote on Wednesday whether to push Milan’s appointment to the Senate for consideration, with Democrats expected to unanimously oppose it, but Republicans should pass the xmaccount.committee with a 13:11 majorityPromote. It is not clear at the time of voting in the whole hospital. A Senate Republican aide said Milan's nomination could be confirmed as early as next Monday.
5. After the tariff agreement was reached, Japan's manufacturing confidence reached its best in three years
A short-term survey by Reuters showed that Japan's manufacturing confidence was the best in more than three years in September, as trade uncertainty eased after Japan reached a tariff agreement with the United States in July. Japan's short-term manufacturing industry prosperity judgment index rose from 9 to 13 in September, the third consecutive month of increase and the highest level since August 2022. Manufacturers expect confidence to drop slightly to 11 by December. Among the nine manufacturing industries surveyed, six sectors improved confidence, including the automotive and transportation machinery sectors, with their index jumping from 25 to 33, the highest level since December 2023. Several managers in the transportation machinery industry said they received steady orders, while some mentioned that domestic production has stagnated in recent months due to shrinking exports.
Institutional View
1. Netherlands International: The Swiss Franc may appreciate further after the President of the Swiss National Bank said in a report that the Swiss Franc may appreciate further after Swiss National Bank President Schlegel downplayed the strength of the Swiss Franc. Schlegel said in an interview that given that the Swiss franc's actual appreciation is not as large as it seems, given that prices in other countries have risen much faster and increase corporate costs. He added that there are high barriers to reintroduction of negative interest rates. Turner said his remarks could further benefit the Swiss franc from safe haven funds. 2. Market Analysis: UK long-term Treasury yields may fall in the near future
RBC Capital Markets strategist said in a report that UK long-term Treasury yields may fall in the xmaccount.coming months after the UK's 30-year Treasury yield hit a 27-year high last week. The bank said the UK Debt Management Office increased the proportion of short-term Treasury bond supply between October and December, which could support demand for long-term Treasury bonds, easing pressure on long-term bond yields. The Bank of England is also expected to reduce Treasury sales under its quantitative tightening plan. Strategists say this should support UK long-term Treasury bonds.
3. Market Analysis: The euro may rise if the ECB implies an end to a rate cut.
MonexEurope analysts said in a report that the euro may rise if the ECB stated at its meeting on Thursday that its rate cut cycle was over. "We expect deposit rates to remain at 2%, as ECB President Lagarde is likely to officially announce a victory over inflation and send a signal to end this easing cycle, echoing her remarks on September 1." Analysts said this will push the euro higher against the dollar, especially given that the Fed may resume interest rate cuts at its September 17 meeting.
The above content is about "[XM Foreign Exchange Market Analysis]: Dollar Index MaintainsThe entire content of the volatile market, the market focuses on US inflation data, was carefully xmaccount.compiled and edited by the editor of XM Forex. I hope it will be helpful to your transactions! Thanks for your support!
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