Here is what you need to know on Monday, October 18:
The greenback is gathering strength in the early hours of the European session on Monday as investors stay focused on the US Treasury bond yields in the absence of significant fundamental drivers and high-tier data releases. September Industrial Production data will be featured in the US economic docket in the second half of the day but the market mood alongside the performance of US T-bond yields is likely to continue to impact the USD's valuation.
Earlier in the day, the data from China revealed that the Gross Domestic Product (GDP) expanded by 0.2% on a quarterly basis in the second quarter after growing by 1.3% in the second quarter. This reading missed the market expectation of 0.5% and caused risk sentiment to sour during the Asian trading hours.
The US stocks futures are down between 0.1% and 0.3%, suggesting that Wall Street's main indexes are likely to open not too far away from Friday's closing level. On a weekly basis, the S&P 500 and the Dow Jones Industrial Average rose 1.8% and 1.6%, respectively. In the meantime, the benchmark 10-year US Treasury bond yield is up nearly 2% at 1.605%.
Gold suffered heavy losses in the second half of the previous week as the precious metal remains extremely sensitive to movements in the US T-bond yields. XAU/USD is currently moving sideways in a relatively tight range around $1,770 but the pair could feel renewed bearish pressure when trading volume rises with European and American traders entering the market.
EUR/USD's recovery attempt failed to convince investors that the pair was about to reverse its direction. The European Central Bank's dovish outlook remains intact and makes it difficult for the common currency to find demand. On Monday, the pair is trading in the negative territory below 1.1600.
USD/JPY stays relatively calm after posting its strongest weekly close since March 2017 at 114.20. Rising US T-bond yields continue to fuel the pair's upside.
GBP/USD managed to close the second straight week in the positive territory and seems to have gone into a consolidation phase above 1.3700. The Bank of England's hawkish policy outlook and renewed Brexit optimism help the British pound stay resilient against the dollar.
Despite rising copper prices, the AUD/USD pair edges lower on Monday pressured by the disappointing Chinese growth data.
Cryptocurrencies: Bitcoin continues to trade above $60,000 as crypto investors wait for the first Bitcoin ETF to debut in the US either on Monday or Tuesday. Ethereum stays within a touching distance of $4,000 and Ripple is fluctuating around $1.1.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats from daily highs, holds above 1.0800
EUR/USD loses traction but holds above 1.0800 after touching its highest level in three weeks above 1.0840. Nonfarm Payrolls in the US rose more than expected in June but downward revisions to May and April don't allow the USD to gather strength.
GBP/USD struggles to hold above 1.2800 after US jobs data
GBP/USD spiked above 1.2800 with the immediate reaction to the mixed US jobs report but retreated below this level. Nonfarm Payrolls in the US rose 206,000 in June. The Unemployment Rate ticked up to 4.1% and annual wage inflation declined to 3.9%.
Gold approaches $2,380 on robust NFP data
Gold intensifies the bullish stance for the day, rising to the vicinity of the $2,380 region following the publication of the US labour market report for the month of June. The benchmark 10-year US Treasury bond yield stays deep in the red near 4.3%, helping XAU/USD push higher.
Crypto Today: Bitcoin, Ethereum and Ripple lose key support levels, extend declines on Friday
Crypto market lost nearly 6% in market capitalization, down to $2.121 trillion. Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) erased recent gains from 2024.
French Elections Preview: Euro to “sell the fact” on a hung parliament scenario Premium
Investors expect Frances's second round of parliamentary elections to end with a hung parliament. Keeping extremists out of power is priced in and could result in profit-taking on Euro gains.