Select Language

Forex Today: Market volatility set to rise on key GDP and inflation data

Breaking news

Forex Today: Market volatility set to rise on key GDP and inflation data

  • X
  • facebook
  • LINE
  • RSS

  • X
  • facebook
  • LINE
  • RSS
New update 2024.10.30 15:53
Forex Today: Market volatility set to rise on key GDP and inflation data

update 2024.10.30 15:53

Here is what you need to know on Wednesday, October 30:

The action in foreign exchange markets remain subdued early Wednesday as investors gear up for key macroeconomic data releases. The European economic docket will feature inflation and Gross Domestic Product (GDP) data for Spain, Italy and Germany, as well as GDP figures for the Eurozone. Later in the day, ADP Employment Change data from the US will be watched closely and the US Bureau of Economic Analysis will publish the first estimate of the annualized GDP growth for the third quarter. 

After edging higher during the European trading hours on Tuesday, the US Dollar (USD) Index lost its traction on disappointing JOLTS Job Openings data for September and closed the day virtually unchanged. Early Wednesday, the index continues to move sideways above 104.00. Meanwhile, US stock index futures trade marginally higher following the mixed action seen in Wall Street on Tuesday. The US GDP report will also include quarterly Personal Consumption Expenditures (PCE) Price Index readings.

US Dollar PRICE This week

The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Australian Dollar.

  USD EUR GBP JPY CAD AUD NZD CHF
USD   -0.28% -0.40% -0.02% 0.16% 0.77% 0.25% -0.19%
EUR 0.28%   0.00% 0.18% 0.44% 1.13% 0.51% 0.11%
GBP 0.40% -0.00%   1.02% 0.56% 1.18% 0.62% 0.37%
JPY 0.02% -0.18% -1.02%   0.24% 0.14% -0.48% -0.64%
CAD -0.16% -0.44% -0.56% -0.24%   0.56% 0.02% -0.31%
AUD -0.77% -1.13% -1.18% -0.14% -0.56%   -0.63% -1.00%
NZD -0.25% -0.51% -0.62% 0.48% -0.02% 0.63%   -0.44%
CHF 0.19% -0.11% -0.37% 0.64% 0.31% 1.00% 0.44%  

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

EUR/USD fell below 1.0800 on Tuesday but staged a rebound in the American session to end the day flat. The pair holds steady at around 1.0820 to begin the European session. In addition to above-mentioned data, the European Commission will publish business and consumer sentiment figures for October.

GBP/USD registered small gains and closed above 1.3000 on Tuesday. The pair stays in a consolidation phase early Wednesday. The UK government will release the Autumn Forecast Statement and unveil the Autumn Budget later in the day.

During the Asian trading hours, the data from Australia showed that the Consumer Price Index (CPI) rose 0.2% on a quarterly basis in the third quarter. This reading followed the 1% increase recorded in the second quarter and came in slightly below the market expectation of 0.3%. On a yearly basis, the CPI rose 2.8%, compared to analysts' estimate of 2.9%. AUD/USD stays under modest bearish pressure and trades near 0.6550 in the European morning on Wednesday.

USD/JPY failed to gather directional momentum and ended the day flat on Tuesday. The pair stays relatively quiet early Wednesday and fluctuates in a narrow band above 153.00.

Gold gathered bullish momentum and gained more than 1% on Tuesday. XAU/USD continues to stretch higher toward $2,800 and trades at a new record-high on Wednesday.

GDP FAQs

A country's Gross Domestic Product (GDP) measures the rate of growth of its economy over a given period of time, usually a quarter. The most reliable figures are those that compare GDP to the previous quarter e.g Q2 of 2023 vs Q1 of 2023, or to the same period in the previous year, e.g Q2 of 2023 vs Q2 of 2022. Annualized quarterly GDP figures extrapolate the growth rate of the quarter as if it were constant for the rest of the year. These can be misleading, however, if temporary shocks impact growth in one quarter but are unlikely to last all year - such as happened in the first quarter of 2020 at the outbreak of the covid pandemic, when growth plummeted.

A higher GDP result is generally positive for a nation's currency as it reflects a growing economy, which is more likely to produce goods and services that can be exported, as well as attracting higher foreign investment. By the same token, when GDP falls it is usually negative for the currency. When an economy grows people tend to spend more, which leads to inflation. The country's central bank then has to put up interest rates to combat the inflation with the side effect of attracting more capital inflows from global investors, thus helping the local currency appreciate.

When an economy grows and GDP is rising, people tend to spend more which leads to inflation. The country's central bank then has to put up interest rates to combat the inflation. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold versus placing the money in a cash deposit account. Therefore, a higher GDP growth rate is usually a bearish factor for Gold price.

 


Date

Created

 : 2024.10.30

Update

Last updated

 : 2024.10.30

Related articles


Show more

FXStreet

Financial media

arrow
FXStreet

FXStreet is a forex information website, delivering market analysis and news articles 24/7.
It features a number of articles contributed by well-known analysts, in addition to the ones by its editorial team.
Founded in 2000 by Francesc Riverola, a Spanish economist, it has grown to become a world-renowned information website.

Was this article helpful?

We hope you find this article useful. Any comments or suggestions will be greatly appreciated.  
We are also looking for writers with extensive experience in forex and crypto to join us.

please contact us at [email protected].

Thank you for your feedback.
Thank you for your feedback.

Most viewed

NZD/JPY Price Analysis: Pair tumbles and eyes break of 90.00-92.00 range

The NZD/JPY pair has been on a downward trajectory for the past three days, shedding 0.27% on Friday's session to close near the 90.30 level.
New
update2024.11.23 06:57

Silver Price Forecast: XAG/USD surges above $31.00 as US yields fall

Silver price recovered some ground on Friday and reclaimed the $31.00 a troy ounce, boosted by falling US Treasury bond yields and despite a firm US Dollar.
New
update2024.11.23 06:31

NZD/USD Price Analysis: Pair fell to lowest level since November, bears command

The NZD/USD pair extended its losses on Friday, declining by 0.54% to 0.5830, its lowest level since early November.
New
update2024.11.23 06:18

Canadian Dollar loses momentum on Friday

The Canadian Dollar (CAD) waffled into the midrange on Friday, testing into the low side but ultimately getting hamstrung as Canadian data comes in mixed and gets overshadowed by sentiment-bolstering US data prints.
New
update2024.11.23 05:47

Australian Dollar retreats as US Dollar gains momentum after S&P PMI data

The AUD/USD declined just below 0.6500 as the market is focused on the US Dollar's strength.
New
update2024.11.23 05:07

Gold price reaches two-week peak as US yields fall, geopolitical tensions rise

Gold price rallies to a new two-week high on Friday during the North American session as US Treasury bond yields drop.
New
update2024.11.23 04:55

Dow Jones Industrial Average soars another 350 points

The Dow Jones Industrial Average (DJIA) has snapped its recent soft patch, extending its midweek bullish pivot into a firm Friday performance.
New
update2024.11.23 03:56

US Dollar retraces from two-year high after PMI data, geopolitical uncertainty prevails

In Friday's session, the US Dollar Index (DXY) declined slightly after reaching a new two-year high amidst geopolitical instability.
New
update2024.11.23 03:08

Mexican Peso slumps, shrugging off solid data

The Mexican Peso retreats for the third straight day versus the US Dollar, although economic data suggests the country's economy grew in the third quarter while inflation edged lower.
update2024.11.23 02:37

A (local) peak in Gold is now imminent - TDS

The downturn in Gold prices underscored by sharp liquidations from macro funds lined up exceptionally well with historical patterns surrounding drawdowns associated with macro fund liquidations from extreme levels, averaging between 7-10% over the last decade, TDS' Senior Commodity Strategist Daniel Ghali notes.
update2024.11.23 01:02

Disclaimer:arw

All information and content provided on this website is provided for informational purposes only and is not intended to solicit any investment. Although all efforts are made in order to ensure that the information is correct, no guarantee is provided for the accuracy of any content on this website. Any decision made shall be the responsibility of the investor and Myforex does not take any responsibility whatsoever regarding the use of any information provided herein.

The content provided on this website belongs to Myforex and, where stated, the relevant licensors. All rights are reserved by Myforex and the relevant licensors, and no content of this website, whether in full or in part, shall be copied or displayed elsewhere without the explicit written permission of the relevant copyright holder. If you wish to use any part of the content provided on this website, please ensure that you contact Myforex.

  • Facebook
  • Twitter
  • LINE

Myforex uses cookies to improve the convenience and functionality of this website. This website may include cookies not only by us but also by third parties (advertisers, log analysts, etc.) for the purpose of tracking the activities of users. Cookie policy

I agree
share
Share
Cancel