Here’s what you need to know on Wednesday, September 11:
The US Dollar (USD) is experiencing selling pressure early Wednesday as markets prepare for crucial inflation data. The US Bureau of Labor Statistics is set to release the Consumer Price Index (CPI) for August, and later in the day, the US Treasury will conduct a 10-year note auction.
After a strong start to the week, the USD Index remains under pressure in the European morning, with a loss of nearly 0.3% observed. The decline in US Treasury bond yields and the significant drop in the USD/JPY pair are contributing to the USD’s challenges. Currently, the benchmark 10-year US Treasury bond yield is at its lowest since June 2023, around 3.6%. The annual CPI is forecast to increase by 2.6%, slower than the 2.9% rise recorded in July.
Bank of Japan (BoJ) board member Junko Nagakawa indicated on Wednesday that the BoJ might adjust its monetary easing policy if economic and price trends align with their forecasts. She noted, "Even after the July rate hike, real interest rates remain deeply negative, and accommodative monetary conditions persist." As a result of these comments, the USD/JPY has dropped to its lowest level since January, trading below 141.50 and down more than 0.7% on the day.
Gold is benefiting from falling US Treasury bond yields, pushing prices toward $2,530. XAU/USD reached an all-time high of $2,531 on August 20.
Following three consecutive days of losses, EUR/USD is rebounding in the early European session, trading near 1.1050.
In the UK, the Office for National Statistics reported that Industrial Production and Manufacturing Production fell by 0.8% and 1%, respectively, on a monthly basis in July. Additionally, the monthly Gross Domestic Product (GDP) remained unchanged in July. As a result, GBP/USD struggles to gain momentum and is trading slightly below 1.3100.
