Recession fears meet flash PMIs

Further decline saw the Greenback recede to levels last traded in late December 2023 in the sub-101.00 zone, as bets for a rate cut in September were boosted by the FOMC Minutes of the July gathering.

Here is what you need to know on Thursday, August 22:

The USD Index (DXY) retreated to the 100.90 zone against the backdrop of extra losses in US yields across the curve and firmer expectations of a rate cut in September. The Jackson Hole Symposium kicks in on August 22, while on the US docket are expected the usual weekly Initial Jobless Claims, the Chicago Fed National Activity Index, Existing Home Sales, and the advanced S&P Global Manufacturing and Services PMIs for the month of August.

EUR/USD accelerated its bullish impulse and hit new YTD peaks past 1.1170, always in response to the pronounced sell-off in the US Dollar. On August 22, the ECB will publish its Meeting Accounts, along with the release of preliminary HCOB Manufacturing and Services PMIs for the current month in both Germany and the broader euro area and the flash Consumer Confidence gauge in the bloc tracked by the European Commission.

Following its risky peers, GBP/USD reached fresh 2024 tops north of the 1.3100 barrier amidst the exacerbated selling pressure in the Greenback. The advanced S&P Global Manufacturing and Services PMIs for the month of August will be unveiled on August 22, seconded by the CBI Industrial Trends Orders.

USD/JPY added to the weekly leg lower and broke below the 145.00 support with certain conviction following lower yields and the sharp retracement in the Dollar. The preliminary Jibun Bank Manufacturing and Services PMIs are due on August 22, seconded by weekly Foreign Bond Investment figures.

Further gains saw AUD/USD clinch multi-day peaks near 0.6760 on the back of the continuation of the downward bias in the US Dollar. The flash Judo Bank Manufacturing and Services PMIs are expected on August 22.

Recession fears and omnipresent demand concerns coming from the sluggish Chinese economy weighed further on traders and dragged WTI prices to nearly seven-month lows around $71.50 per barrel.

Gold prices rose marginally, although enough to keep the trade above the key $2,500 mark per ounce troy. Silver left behind Tuesday’s irresolute day and advanced past the $29.00 mark per ounce.