The US Dollar (USD) is losing its shine as the Greenback is no longer the king. Lower US Consumer Confidence data and the sharp decline in JOLTS Job O
penings points to a firm dent in the staggering performance of the US economy since last year. With several data points starting to flash and signal distress, the tipping point could come in sooner than the US Federal Reserve presumes, and might need earlier interest-rate cuts than needed in order not to crash the US economy and engineer a soft landing.
The second estimate of US Gross Domestic Product data will come out at 12:30 GMT. For the second quarter, the Price Index is expected to stay steady at 2.2%. The annualized GDP growth is also seen unchanged from preliminary estimates, which came at 2.4%. Apart from this, Wholesale Inventories index for July is to come out as well, expected to head from -0.5% to -0.4%.
The CME Group’s FedWatch Tool shows that markets are pricing in an 86.5% chance that the Federal Reserve will keep interest rates unchanged at its meeting in September. The 78% probability got quickly reassessed after the downbeat data from the JOLTS report. On the downside, several floors are likely to prevent a steep decline in the DXY. The first one is the big figure at 104.00. Though seeing the current decline, that does not look strong enough to hold. Rather look for the 200-day Simple Moving Average at 103.14. That is a much better candidate in order to catch some profit-taking pressure and reenter. In case it does not hold, the safety net at 102.33 comes into play, holding both the 55-day SMA and the 100-day SMA.
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