• A slower start for major currencies so far today
• Oil jumps amid report that OPEC+ is discussing a delay to planned output hike in October
• Reminder: There is no ADP roulette on the agenda today
• Eurozone August final services PMI 52.9 vs 53.3 prelim
• UK August final services PMI 53.7 vs 53.3 prelim
• US MBA mortgage applications w.e. 30 August +1.6% vs +0.5% prior
• German economy expected to contract this year, says Kiel Institute
• German trade lobby sounds warning as recession clouds circle

Markets:

• JPY leads, USD and CAD lag on the day
• European equities lower; S&P 500 futures down 0.4%
• US 10-year yields down 3.8 bps to 3.806%
• Gold down 0.2% to $2,489.13
• WTI crude up 1.0% to $70.86
• Bitcoin down 2.9% to $56,510

It was a bit of a draggy session for major currencies as there wasn’t too much to work with.

The dollar is marginally lower at the balance, but mostly keeping lightly changed against the rest of the major currencies bloc outside of the Japanese yen. USD/JPY is down 0.4% to just under 145.00, continuing to weave in and out around the figure level. Meanwhile, the rest of the dollar pairs are just 0.1% changed among one another thus far on the day.

That despite equities staying pressured after the selloff yesterday. S&P 500 futures remain pinned down since Asia but the losses aren’t getting much worse as we look towards US trading at least. Bond yields are continuing to look heavy and that is perhaps weighing on USD/JPY as well. 10-year Treasury yields are down nearly 4 bps to around 3.80% currently.

Among the headlines, we did see one involving the oil market. A Reuters report noted that OPEC+ is considering delaying their planned output hike in October. And that saw oil prices bounce back a little with WTI crude moving up by 1% away from the $70 mark before that.

In other markets, gold was under some light pressure earlier in falling to $2,472 but is now climbing back up to $2,489 on the day. The push and pull continues as price action continues to consolidate in and around $2,500, awaiting the next big move.

Coming up later, we will have the Bank of Canada policy decision and US JOLTS job openings as key risk events for markets.

This article was written by Justin Low at www.forexlive.com.

• Prior +0.5%
• Market index 230.5 vs 226.9 prior
• Purchase index 136.1 vs 131.8 prior
• Refinance index 751.4 vs 753.8 prior
• 30-year mortgage rate 6.43% vs 6.44% prior

Mortgage applications rose in the past week but the breakdown was a bit more mixed. Purchases jumped but was partially offset by a decline in refinancing activity. That as the average rate of the most popular US home loan remained relatively stable after the recent drop.

This article was written by Justin Low at www.forexlive.com.

Reuters is out with the headline, citing three OPEC+ sources in saying that the bloc is discussing a delay to its planned output hike in October. It looks like they are finally not being stubborn about it but it took oil prices falling to its lowest levels this year for them to start rethinking about this. Pfft.

Anyway, the jump here still sees $70 as the key threshold on the daily and weekly charts. And I wouldn’t be too confident about the bounce here lasting unless risk trades also turn around and markets grow less concerned about global growth in the near-term. The US data this week, especially the jobs report on Friday, will be key in determining that sentiment.

This article was written by Justin Low at www.forexlive.com.

That opposed to a Trump victory of course, according to Goldman Sachs. The firm argues that economic output will take a hit next year under the Trump banner. And that is mostly from increased tariffs on imports and tighter immigration policies. Adding that jobs growth will also be stronger under a Democrat government as opposed to a Republican one.

„We estimate that if Trump wins in a sweep or with divided government, the hit go growth from tariffs and tighter immigration policy would outweigh the positive fiscal impulse, resulting in a peak hit to GDP growth of -0.5% in 2H 2025 that abates in 2026. If Democrats sweep, new spending and expanded middle-income tax credits would slightly more than offset lower investment due to higher corporate tax rates, resulting in a very slight boost to GDP investment due to higher corporate tax rates, resulting in a very slight boost to GDP growth on average over 2025-26.“

On the inflation front, Goldman Sachs says that a Trump win will likely lead to a rise in core inflation amid increased tariffs on auto imports from China and the EU.

This article was written by Justin Low at www.forexlive.com.

Yesterday, we got the US
ISM Manufacturing PMI and even though the headline number missed
expectations, under the hood the report was better than the prior month.

The bad news was new orders
falling further into contraction, which is a proxy for demand, and it’s
generally considered as a leading indicator.

Tight monetary policy of
course has been weighing a lot on the manufacturing sector and if the Fed
manages to avoid a hard landing as it cuts rates in the next months, we could
see a rebound in Q4.

From a monetary policy
perspective, the data didn’t change much for the Fed expectations although the
probabilities for a 50 bps cut edged a bit higher. For the RBNZ, the market
sees a 40% probability of a 50 bps cut in October and a total of 75 bps of
easing by year-end.

NZDUSD
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that NZDUSD is testing a key support
zone around the 0.6175 level where we can find the confluence
of the trendline
and the 38.2% Fibonacci
retracement level. We can expect the buyers to step in with a defined risk
below the trendline to position for a rally into a new high. The sellers, on
the other hand, will want to see the price breaking lower to increase the
bearish bets into the 0.6050 support.

NZDUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see more clearly the setup around the 0.6175 level. There’s also a counter-trendline
defining the bearish momentum of the pullback. The buyers will want to see the
price breaking higher to increase the bullish bets into new highs, while the
sellers will likely lean on it to position for a break below the major upward
trendline.

NZDUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that the price consolidated near the trendline with no major reaction from
the ISM Manufacturing PMI. There’s not much else we can glean from this
timeframe as the buyers will just look for a bounce, while the sellers will
look for a break. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we have the US Job Openings. Tomorrow, we get the US Jobless Claims
figures and the ISM Services PMI. Finally, on Friday, we conclude the week with
the US NFP report.

This article was written by Giuseppe Dellamotta at www.forexlive.com.