Despite selling pressure in the risk complex, a lack of direction in US rates, and caution ahead of US inflation data on September 13, the USD Index (DXY) reclaimed the 104.80–90 range on Tuesday. Markets anticipate interest rate reductions in Q2 2024 following the Fed’s final rate increase of this cycle in July.

The API’s weekly report on US crude oil stocks will be published after the NFIB Business Optimism Index is released in the US data area. The index is now aiming for the 105.00 region after recovering from four-day lows close to 104.50. Despite the Federal Reserve’s tighter-for-longer posture appearing weakened due to sustained disinflation and labour market cooling, the strong US economy serves as support for the currency.

The MBA Mortgage Applications, the Inflation Rate, and the monthly budget statement are among this week’s US happenings. With rate reductions rumoured for early 2024, the argument over whether the US economy will experience a soft or hard landing continues. The next upward barrier for the USD Index is at 105.15, where it is now up 0.20% at 104.73. 102.95 and 102.70 could result from a breach of 103.00. Another issue is the geopolitical effervescence with regard to China and Russia.

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