Forex Today: US Dollar on weak footing, markets focus on central bank speak

Here is what you need to know on Monday, September 30:

The US Dollar (USD) struggles to find demand to start the last trading day of the third quarter. In the first half of the day on Monday, investors will pay close attention to Consumer Price Index data from Germany. Later in the American session, several Federal Reserve policymakers, including Chairman Jerome Powell, will be delivering speeches.

The USD Index turned south on Friday and touched its weakest level in over a year at 100.15, before staging a technical correction toward the end of the week. The US Bureau of Economic Analysis reported that the core Personal Consumption Expenditures (PCE) Price Index rose 0.1% on a monthly basis in August, at a softer pace than the market expectation of 0.2%. Early Monday, the USD Index stays below 100.50. Powell will participate in a moderated discussion titled "A View from the Federal Reserve Board" at the National Association for Business Economics Annual Meeting, in Nashville, starting at 17:00 GMT. Fed Governor Michelle Bowman is also scheduled to speak in the early American session. Meanwhile, US stock index futures trade marginally lower on the day.

The data from China showed on Monday that the Caixin Manufacturing PMI declined to 49.3 in September from 50.4 in August, while the Caixin Services PMI edged lower to 50.3 from 51.6. Over the weekend, Bloomberg reported that the People's Bank of China (PBOC) is planning to tell banks to lower mortgage rates for existing home loans before October 31 in its latest attempt to shore up the troubled property sector as the economy slows. In the meantime, ANZ Business Confidence Index in Australia improved to 60.9 in September from 50.6 in August. AUD/USD edged higher to start the new week and the pair was last seen trading at its highest level since February 2023 above 0.6900.

The UK's Office for National Statistics announced early Monday that it revised the annualized Gross Domestic Product (GDP) growth for the second quarter lower to 0.7% from the 0.9% reported in the advanced estimate. GBP/USD clings to modest daily gains, slightly below 1.3400 after this data.

After declining sharply and losing more than 1.5% on a daily basis on Friday, USD/JPY continues to inch lower toward 142.00 early Monday. Following reports from various Japanese media outlets over the weekend, Japan's incoming Prime Minister (PM) Shigeru Ishiba proposed October 27 for a snap election. If a snap election is confirmed by end-October, the parliament will likely be dissolved by October 9.

EUR/USD stays relatively quiet in the early European session and fluctuates in a narrow channel above 1.1150. 

After setting a new all-time high above $2,680 on Thursday, Gold registered modest losses on Friday. XAU/USD holds steady and trades in a tight range above $2,650 early Monday.