Weekly currency forecast: Slowing inflation to weaken the US dollar?
Currencies Direct October 7th 2024 - < 1 minute read
Looking to the week ahead, the recent rebound in the US dollar may be cut short this week if a slowdown in US inflation revives bets for another aggressive interest rate cut from the Federal Reserve.
Pound (GBP)
The only GBP data of note this week will be the UK’s latest GDP print. The monthly figures may help to underpin the pound (GBP) if they report the UK economy returned to growth in August.
Euro (EUR)
The minutes from the European Central Bank’s (ECB) latest policy meeting will be released this week. EUR investors will look to the minutes to gauge whether there is any appetite for further monetary easing, with the euro (EUR) poised to fall if they suggest an October rate cut may be on the table.
US dollar (USD)
Centre stage this week will be the publication of the latest US consumer price index. September’s CPI figures are expected to report inflation in the US continued to cool. This could revive bets for another 50bps interest rate cut from the Federal Reserve and pull the US dollar (USD) lower in the latter half of the session.
Australian dollar (AUD)
The minutes from the Reserve Bank of Australia’s (RBA) latest policy meeting may act as the main catalyst of movement for the Australian dollar (AUD) this week. The ‘Aussie’ is likely to soften if the minutes further trim bets for another rate hike.
Written by
Currencies Direct