US CPI could have the last word before rate cuts

The greenback succumbed to growing market expectations of a Fed rate cut within weeks, although its size remains unclear so far. Lower yields also strengthened the dollar’s downward trajectory, while bouts of concern over the health of the US economy also added to the weekly price action.

The US dollar index (DXY) ended Friday’s session with decent gains, although that didn’t stop it from pulling back on the week amid strong downtrend in US yields. Wholesale inventories are due on September 9, along with consumer inflation expectations. On September 10, the NFIB Business Optimism Index and API’s weekly report on US crude oil inventories will be released. The inflation rate is in the spotlight on September 11 ahead of the usual weekly mortgage applications tracked by the MBA and the EIA report on US crude oil inventories. Inflation will remain at the center of the debate with the release of producer prices on September 12. Export and import prices are due on September 13, supported by preliminary Michigan Consumer Sentiment.

EUR/USD was unable to sustain the post-NFP rally to multi-day highs near 1.1160, then slipped almost a cent lower. Germany’s final inflation rate comes out on September 10, along with the European Commission’s summer forecast. The ECB meeting will be the key event on September 12, followed by Germany’s results on wholesale prices and the current account. On September 13, industrial production in the Eurozone will be revealed.

GBP/USD ended its second straight week of losses after Friday’s strong rally to the 1.3240 region failed to hold. The UK labor market report will be published on 10 September. In addition, figures on GDP, trade balance results, industrial and manufacturing output and NIESR’s monthly GDP monitor will be released on September 11. Finally, the RICS House Price Balance comes on 12th September.

USD/JPY extended its bearish streak and flirted with four-week lows in the 141.80-141.75 band. A file uploaded on September 9 will present Q2 GDP figures, bank loans and current account data. On September 10 comes the Eco Watchers survey and machine tool orders. Weekly foreign bond investment figures are due on September 12, supported by the BSI Large Manufacturing Index and producer prices. On September 13, the Reuters Tankan index, capacity utilization and industrial production will close the weekly calendar.

The greenback’s late Friday rally weighed on AUD/USD, sending it into the area of ​​three-week lows around 0.6660. On September 9th, the final Building Permits are due, followed by the Approvals for private dwellings. Westpac’s Consumer Confidence Index and NAB Business Confidence are due on September 10, while consumer inflation expectations measured by the Melbourne Institute are due on September 11.

Anticipating the economic outlook: Voices on the horizon

• The ECB’s McCaul is due to speak on September 9.
• BoC’s Macklem speaks on September 10th.
• The BoJ’s Nakagawa speaks on 11 September, followed by the ECB’s McCaul and Buch and the RBA’s Hunter.
• The ECB’s McCaul, Buch, af Jochnick and Lagarde speak on September 12, along with the BoE’s Breeden and the BoJ’s Tamura.
• ECB’s Lagarde speaks on September 13.

Central Banks: Upcoming Meetings to Shape Monetary Policy

• The ECB meets on September 12.