Forex News

• Silver rebounds above $66 after briefly falling below $65 in the immediate aftermath of the US jobs report.
• US employers added 162K jobs in August, almost three times the 56K expected by markets.
• The initial jump in the US Dollar loses momentum, allowing the precious metal to recover some ground.

Silver (XAG/USD) trades around $66.20 at the time of writing on Friday, down 1.18% on the day, after recovering part of its sharp post-Nonfarm Payrolls (NFP) decline. The precious metal initially tumbled to an intraday low of $64.74 as stronger-than-expected United States (US) employment data boosted the US Dollar (USD) and Treasury yields, before buyers stepped back in as the initial market reaction faded.

The US economy added 162K jobs in August, comfortably exceeding market expectations of 56K. July's figure was revised to a gain of 21K from the previously reported decline of 23K, while June payroll growth was revised higher to 31K from 20K. The Unemployment Rate remained unchanged at 4.1%, in line with expectations.

The stronger labor-market figures initially triggered a sharp repricing across financial markets. The US Dollar Index (DXY), which tracks the Greenback against a basket of six major currencies, jumped as high as 99.36 following the release, while the benchmark 10-year US Treasury yield retested the 4.81% area.

These moves weighed heavily on Silver, as a stronger US Dollar makes the USD-denominated precious metal more expensive for overseas buyers, while higher Treasury yields increase the opportunity cost of holding non-yielding assets.

However, both the US Dollar and Treasury yields subsequently lose some momentum. The DXY retreats toward 99.10, while the 10-year Treasury yield eases toward 4.77%, helping XAG/USD rebound by more than $1 from its intraday low.

The employment report also shifts expectations surrounding the Federal Reserve's (Fed) September monetary policy decision. According to the CME FedWatch Tool, markets now assign around a 60% chance to a 25-basis-point interest rate hike at the September 15-16 meeting, compared with roughly 50% before the NFP release.

The stronger jobs data put additional emphasis on next week's US inflation figures. The Consumer Price Index (CPI) and Producer Price Index (PPI) could prove decisive for the Fed after Governor Christopher Waller said on Thursday that the September decision hinges on August inflation.

Waller noted that he is "finally seeing some signs of disinflation" and that the current interest-rate setting could bring inflation back toward the Fed's 2% target. However, he also warned that hotter-than-expected August inflation data could lead him to consider an interest rate hike.

Silver therefore remains caught between renewed expectations of tighter US monetary policy and the fading initial reaction in the US Dollar and Treasury yields. While the strong NFP report keeps pressure on the white metal on Friday, the retreat from the post-release peaks in both the Greenback and yields allows XAG/USD to recover a significant portion of its initial losses.

XAG/USD technical analysis

In the one-hour chart, XAG/USD trades at $66.35. The near-term tone remains capped, as price holds below the 200-hour Simple Moving Average (SMA) at $67.10 while only marginally above the 100-hour SMA at $65.73, suggesting a fragile consolidation under broader overhead supply. The Relative Strength Index (RSI) at 49.22 sits near neutral, hinting that momentum has cooled after the latest pullback and leaving the metal vulnerable to renewed downside if sellers return.

On the topside, immediate resistance emerges at the 200-hour SMA near $67.10, with the next barrier at the horizontal level around $67.50, where fresh selling could be expected on an initial test. On the downside, initial support is provided by the 100-hour SMA at $65.73, ahead of a more notable floor at $64.74 and then $63.32, where a break would reinforce the bearish bias and open the door to a deeper correction.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

• EUR/USD recovers most of its NFP-driven decline as the US Dollar loses momentum.
• The 200-day Simple Moving Average at 1.1634 caps the immediate upside.
• Momentum indicators lean mildly bullish, with the RSI holding above the neutral 50 level.

EUR/USD sees sharp two-way price swings on Friday after a stronger-than-expected United States (US) employment report triggers fresh volatility. The pair initially fell to an intraday low of 1.1585 before recovering as the US Dollar (USD) struggled to sustain its gains. At the time of writing, EUR/USD trades around 1.1620.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.10 after climbing as high as 99.36 following the employment report.

Technical analysis

On the daily chart, EUR/USD remains trapped between the 100-day Simple Moving Average (SMA) and the 200-day SMA, leaving the pair in a narrow consolidation range.

The broader price structure retains a modest bullish bias. EUR/USD has formed a sequence of higher highs and higher lows since recovering from below 1.1400 in late July and reaching 1.1711 on August 21. The latest price action suggests that another higher low may be developing above the 100-day SMA, although buyers still need to clear the 200-day average to regain control.

The Relative Strength Index (RSI) has eased from the overbought levels reached around the August 21 high but holds above the neutral 50 mark at approximately 56, indicating that bullish momentum has weakened without disappearing entirely.

Meanwhile, the Moving Average Convergence Divergence (MACD) remains marginally below zero, pointing to a mild bearish bias. However, the fading red histogram bars suggest that downside momentum is losing strength.

On the upside, a break above the 200-day SMA near 1.1634 could pave the way toward the 1.1700 mark, followed by the more distant resistance zone around 1.1800.

On the downside, immediate support emerges at the 100-day SMA around 1.1564, followed by the 50-day SMA near 1.1508. A deeper decline would expose the horizontal support region around 1.1400.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Commerzbank’s Commodity Research team, led by Barbara Lambrecht, notes that uncertainty over crude flows through the Strait of Hormuz and conflicting transit data are clouding the outlook for Brent. Upcoming reports from the EIA, IEA and OPEC, plus China’s trade figures, will clarify both supply and demand. The bank highlights that a continued recovery in China’s crude imports would support higher flows and likely cap Brent prices.

Hormuz disruptions and China demand

"The situation in the Strait of Hormuz remains unclear in many respects. Among other things, there are conflicting reports regarding how much oil is currently flowing through the strait each day. Market reports from energy agencies and China’s trade balance figures next week promise to provide some clarity."

"A month ago, the US Energy Information Administration (EIA), which will kick things off on Wednesday, lowered its expectations for shipments through the Strait of Hormuz. For the third quarter as a whole, it even projected larger production losses in the Gulf region than those recorded in July."

"Given the growing number of reports about “workarounds” such as ship-to-ship transfers, the EIA could now take a more optimistic view. At the same time, it had slightly raised its forecast for US oil production next year, primarily reflecting higher oil price assumptions."

"If this trend continued, it would at least confirm that the Strait of Hormuz has become increasingly passable. Oil prices would then be more likely to decline."

"Of particular interest will be the development of OECD inventories and the outlook for global oil demand. In China especially, the current energy crisis has accelerated the shift towards electric mobility, increasingly dampening Chinese oil demand."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Rabobank's Senior Macro Strategist Bas van Geffen expects the European Central Bank (ECB) to hike its deposit rate by 25bp to 2.50% next week and then hold at that level for an extended period. They note markets are pricing a more adverse path with a 3.00% terminal rate, while stressing upside risks if inflation broadens and growth stays resilient.

Markets see higher terminal rate risk

"The ECB will almost certainly hike rates next week, and the markets’ focus is on the path for policy rates after September. We maintain that policymakers will probably hold rates at 2.50% for an extended period, but risks are skewed to further hikes. Those hikes will only materialise if price pressures spreads beyond energy inflation and the economy remains resilient."

"The recent increase in energy prices cements the case for another rate hike when the ECB meets next week. The ECB will remain vigilant, but we expect a more restrained tone for the road ahead than current market pricing."

"So, President Lagarde will reaffirm that the ECB stands ready to act again if this is necessary, but she has little to gain from any stronger pre-commitment. We believe that the market could construe her attempts to keep all options open as somewhat dovish. The ECB would probably not mind that, given current market pricing."

"Current money market pricing is consistent with an ECB that maintains its “measured pace” of tightening, but in a scenario where policymakers are forced to take policy rates into restrictive territory. The OIS curve embeds 85% probability that the ECB will have to hike once more before the end of the year, with a 15-20% tail risk that the ECB may need to accelerate the pace of hikes in October. Furthermore, traders currently price a terminal rate of around 3%."

"Having said that, risks are firmly to the upside. In June, the ECB has proven that it has limited tolerance for inflation risk. If inflation expectations are at risk of accelerating or if there are signs that inflation is starting to spread beyond the direct and indirect effects of higher energy prices, the ECB will not hesitate to hike again."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• DXY rebounds as August NFP crushes expectations with 162K jobs.
• Strong labor market lifts September Fed hike odds to 63%.
• Next week’s CPI and PPI could confirm tightening risks.

The United States Dollar Index (DXY) rises some 0.17% on Friday following a stellar Nonfarm Payrolls (NFP) report, with the economy creating nearly three times as many jobs as expected by most economists, as reported by the Bureau of Labor Statistics (BLS). At the time of writing, the DXY trades at 99.17, after bouncing off a daily low of 98.91.

DXY gains after strong jobs data lift September hike expectations

Data from the US showed the economy added more people to the workforce than expected. Over 162K Americans entered the workforce in August, well above estimates of 56K and crushing July’s upwardly revised report from -23K to 21K. The same report showed the Unemployment Rate stood at 4.1%, beneath Fed officials' estimates of 4.5% towards the end of the year.

Immediately after the data, DXY jumped towards the high of the day at 99.39, before trimming some of its gains. US Treasury yields followed suit, but the move faded.

A stronger labor market increased the chances of a Fed rate hike at the September 16 meeting. The swaps market shows a 63% probability of a 25-bps increase in the Fed funds rate, up from 54% a day ago, according to Prime Terminal.

Now with US jobs data in the rearview mirror, traders are set for next week’s inflation reports, first on the producer and then on the consumer side. If both show the disinflation process is not evolving, this could warrant a rate hike.

On Thursday, Fed Governor Christopher Waller stated that the Fed is in no rush to raise rates if inflation cools down. However, a bad print next week could keep the next Federal Open Market Committee meeting open.

US Dollar Index Price Forecast: Technical outlook

In the daily chart, Dollar Index Spot trades at 99.09. The near-term tone is bearish as price holds below the clustered 50-, 100- and 200-day simple moving averages around 100.22 and also beneath the previously supportive primary uptrend line now referenced near 100.15, while a descending trend line from 101.80 keeps the broader recovery attempt capped around 101.26. The Relative Strength Index (14) at about 42 sits below the midline, hinting at lingering downside pressure rather than an imminent bullish reversal.

On the topside, initial resistance is seen at the broken trend-line region around 100.15, followed closely by the dense simple moving average cluster near 100.22, with the downtrend reference level at 101.26 acting as a more distant cap if a bounce extends. On the downside, the first notable support is the secondary rising trend line projecting near 98.72, where failure would expose lower levels in the broader range and reinforce the prevailing bearish bias.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

ING’s Peter Virovacz expects Hungarian industrial production to rebound in July, helping avoid a third-quarter GDP decline despite August headwinds from heatwave-related energy issues. August inflation is seen rising on higher fuel prices and a weaker Forint, with a 0.2% monthly print lifting headline inflation, though ING still anticipates continued rate cuts despite a more complex backdrop.

Industrial rebound and inflation pickup

"Following a disappointing performance in June, we expect a rebound in industrial production in Monday's release, which is in line with the jigsaw pattern of monthly performance that has recently emerged."

"A good start to the third quarter will be crucial for avoiding a quarterly drop in GDP, as the heatwave and the related energy crisis will definitely bring a significant decrease in industrial production volumes in August due to voluntary production reduction."

"Tuesday brings the release of August inflation."

"We estimate that fuel prices will add roughly 0.10-0.15ppt to the monthly inflation rate in August."

"However, some seasonal factors will counterbalance this, with an expected 0.2% monthly inflation reading pushing up the headline figure after months of disinflation."

"In our view, the 1.4% figure itself won’t make the Monetary Council stop cutting interest rates."

"Still, rising yields, higher energy prices and a weaker HUF make the picture more complex."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• Gold briefly tumbles below $4,400 after the NFP release before staging a recovery.
• US Nonfarm Payrolls rose by 162K in August, well above the 56K market forecast.
• The $4,500 mark acts as immediate resistance, followed by the 200-day SMA near $4,534.

Gold (XAU/USD) remains under pressure on Friday after stronger-than-expected United States (US) Nonfarm Payrolls (NFP) data revive expectations of a Federal Reserve (Fed) rate hike. The metal tumbled to an intraday low near $4,365 and was down more than 2% at one stage before recovering as the US Dollar (USD) and Treasury yields lost momentum. At the time of writing, XAU/USD trades around $4,435, down 0.85% on the day.

The US economy added 162K jobs in August, well above market expectations for a 56K increase. July’s figure was revised higher to a gain of 21K from the previously reported 23K decline, while June payrolls were revised to 31K from 20K. The Unemployment Rate held steady at 4.1%, as expected.

The US Dollar and Treasury yields jumped following the employment report but have since struggled to extend their gains, helping Gold recover from its intraday low. The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.17 after rising as high as 99.36.

Meanwhile, the benchmark 10-year Treasury yield eases to around 4.77% after retesting 4.81%, its highest level since October 2023, touched earlier this week.

The strong payroll gains allow the Fed to focus more closely on the inflation side of its mandate, putting next week’s US Consumer Price Index (CPI) and Producer Price Index (PPI) data firmly in focus. The upbeat employment report reverses some of the dovish repricing triggered by less-hawkish comments from Fed Governor Christopher Waller on Thursday.

Waller said he is “finally seeing some signs of disinflation,” adding that the “current rate setting could get us back to 2% inflation.” He also said the “rate decision in September hinges on August inflation” and that “if August inflation data comes in hot, I would consider a rate hike.”

According to the CME FedWatch Tool, markets now price in around a 60% chance of a 25-basis-point rate hike at the September 15-16 meeting, up from 50% before the NFP release.

Analysts at OCBC remain “constructive” on Gold, but caution that the near-term path is likely to stay “highly sensitive to Fed repricing.” They highlight that “next week’s CPI and PPI should be more decisive in determining whether the recent disinflation trend is sufficient to keep the Fed on hold.” OCBC experts also note that “geopolitical tensions remain supportive at the margin,” but warn that “higher oil prices are a two-sided risk if they feed back into inflation expectations and yields.”

Technical analysis: Buyers eye 200-day SMA

XAU/USD holds just above the 50.0% Fibonacci retracement at $4,371 but is still capped beneath the 200-day Simple Moving Average (SMA) at $4,534. This configuration suggests a corrective tone within a broader downbeat backdrop, with the 100-day SMA at $4,353 offering nearby trend support. The Relative Strength Index (RSI) on the daily chart is at 49, sitting near neutral, while the Moving Average Convergence Divergence (MACD) remains negative and below its signal line, hinting that upside attempts could fade under the weight of overhead resistance.

On the topside, initial resistance is seen at the 38.2% Fibonacci retracement at roughly $4,448, ahead of a dense cap formed by the 200-day SMA around $4,534 and the 23.6% retracement near $4,544. On the downside, immediate support emerges at the 50.0% retracement at $4,371, with further cushions at the 61.8% level around $4,293 and the 78.6% retracement near $4,183. A break below these steps would expose the prior swing floor around the 100.0% retracement at $4,042.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

• USD/CHF gives back part of its NFP-driven jump but remains positive on the day.
• Stronger-than-expected US Nonfarm Payrolls lift expectations of a Federal Reserve rate hike in September.
• Subdued Swiss inflation gives the Swiss National Bank room to keep its policy rate at 0%.

USD/CHF trades higher on Friday as stronger-than-expected United States (US) Nonfarm Payrolls (NFP) data trigger fresh volatility. The pair jumped to 0.8126 following the release before giving back part of its advance. At the time of writing, USD/CHF trades around 0.8102, up nearly 0.34% on the day.

US Nonfarm Payrolls (NFP) rose by 162K in August, comfortably beating expectations for a 56K increase. July’s reading was revised sharply higher to a gain of 21K from the previously reported 23K decline, while June payrolls were revised to 31K from 20K. The Unemployment Rate held steady at 4.1%, as expected.

The US Dollar and Treasury yields jumped in the immediate aftermath of the report, although both have since lost momentum. The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.15 after rising as high as 99.39 following the data.

Even so, the strong employment figures have lifted expectations of a Federal Reserve (Fed) rate hike at the September 15-16 meeting. According to the CME FedWatch Tool, markets now see around a 60% chance of a 25-basis-point increase, up from roughly 50% before the NFP release.

US President Donald Trump welcomed the data in a Truth Social post, calling it a “great jobs number,” while renewing his call for lower borrowing costs. Trump said that “a strong country means a lower interest rate,” adding, “LOWER THE RATE OR I’LL STOP TRADING WITH COUNTRIES WITH WHICH WE HAVE A DEFICIT.” He also said the “Fed Board, with its great new leader, must get smart.”

The US Dollar’s inability to sustain its initial gains reflects lingering uncertainty over the Fed’s monetary policy path. Although the robust jobs report strengthens the case for a September rate hike, recent data have also pointed to moderating inflation. With policymakers remaining committed to restoring price stability, next week’s August Consumer Price Index (CPI) and Producer Price Index (PPI) reports will be crucial in determining whether the Fed raises rates at its upcoming meeting.

On the Swiss side, inflation remains subdued, allowing the Swiss National Bank (SNB) to keep its policy rate at 0%. August inflation exceeded expectations, rising 0.4% MoM following July’s 0.1% decline, while the annual rate accelerated to 0.8% from 0.4%.

According to BBH, “the SNB has plenty of room to keep rates at 0.00% for some time, given that inflation remains well within the bank’s price stability mandate of less than 2% per annum,” a backdrop that they suggest may limit sustained upside for the Franc over the coming quarters.

Royal Bank of Canada (RBC) economist Claire Fan notes Canada’s labour market lost 42,000 jobs in August, partly reversing earlier gains and leaving modest year-to-date job growth. She emphasizes structural factors like demographics and weaker immigration as key drags. Despite this, she highlights improving unemployment, stronger hours worked, and expects solid domestic demand to support further labour market improvement into 2027.

Structural drags but improving indicators

"Headline job growth is notoriously volatile, and we continue to continue to point to structural changes, including rising retirement from aging demographics and slowing population growth from weak immigration as bigger drivers behind dismal job growth in Canada this year."

"As employment is impacted by those structural changes, we have been relying more on the unemployment rate as a better gauge of cyclical conditions."

"In August, the unemployment rate held onto improvements in the prior months."

"This is in line with our own analysis, that continues to expect U.S. tariffs will have pronounced, but targeted effect on Canada’s labour market –we estimated 0.4% of jobs are directly involved in producing the goods that are on the new Section 338 tariff lists."

"Near-term labour market impacts will be watched closely but we continue to expect solid domestic demand, as was seen in GDP data in Q2 will support further labour market improvement into 2027."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

Commerzbank’s Dr. Christoph Balz notes that the U.S. labor market surprised to the upside in August, with Nonfarm Payrolls and private sector jobs both rising strongly while the unemployment rate held at 4.1%. Wage growth continued to slow. The bank stresses that the Federal Reserve, led by Chairman Warsh and Governor Waller, will now focus on August consumer price data for the September 15–16 policy decision, where Commerzbank still expects no rate change.

Jobs strength shifts focus to inflation

"In the U.S., the number of jobs rose by 162,000 in August. The unemployment rate remained at 4.1%, indicating that the economy continues to be at full employment. Overall, the report exceeded expectations."

"From the Federal Reserve’s perspective, however, consumer prices are likely to be more important in determining whether interest rates will be raised on September 16. August’s inflation figures will be released next Friday."

"In August, employment rose by a surprisingly strong 162,000 (consensus estimate: 55,000; Commerzbank forecast: 50,000). In addition, the figures for previous months were revised upward by a total of 55,000. For example, the number of jobs in July did not fall by 23,000 as initially reported, but rose by 21,000."

"Overall, the labor market is thus in solid shape. The trend in employment growth, measured by the six-month average, is pointing upward again. The unemployment rate is roughly at the level generally associated with full employment in the U.S."

"We continue to expect interest rates to remain unchanged, but the risk that the Fed will raise rates after all has certainly increased."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)