America’s Roundup: Dollar firm after US inflation data, Wall Street closes up,Gold falls , Oil prices recover

Market Roundup

• US Core CPI (MoM) (Aug) 0.3%,0.2% forecast,  0.2% previous

•US  Core CPI (YoY) (Aug) 3.2%, 3.2% forecast, 3.2% previous

•US  Core CPI Index (Aug) 319.77, 318.87 previous

•US CPI (YoY) (Aug) 2.5%, 2.5% forecast, 2.9% previous

•US CPI (MoM) (Aug) 0.2%, 0.2% forecast, 0.2% previous

•US  CPI Index, n.s.a. (Aug) 314.80, 314.98 previous

•US CPI Index, s.a. (Aug) 314.12, 313.53 previous

•US CPI, n.s.a. (MoM) (Aug) 0.08%, 0.12% previous

•US  Real Earnings (MoM) (Aug) 0.5%, -0.2% previous

•US  Crude Oil Inventories 0.833M, 0.900M forecast, -6.873M previous

Looking Ahead Economic Data(GMT)

•No data ahead

Looking Ahead Events And Other Releases (GMT)

•No Events Ahead

EUR/USD: The euro dipped    on Wednesday as investors digested US CPI data and awaited ECB rate decision .The European Central Bank is almost certain to cut interest rates again on Thursday, but with inflation risks still simmering despite a stuttering euro zone economy, investors will be searching its statements for clues about further easing.The ECB lowered its deposit rate to 3.75% in June and an array of policymakers have already backed another cut, suggesting their debate is likely to focus on how quickly borrowing costs need to fall in subsequent meetings.The likely outcome is that ECB President Christine Lagarde will stick to the bank's recent narrative that decisions are taken meeting by meeting, based on incoming data. Immediate resistance can be seen at 1.1060(38.2%fib), an upside break can trigger rise towards 1.1116(23.6%fib).On the downside, immediate support is seen at 1.1006(50%fib), a break below could take the pair towards 1.0968 (61.8%fib).

GBP/USD: Sterling declined on Wednesday as UK GDP and output data fell short of forecasts, and losses were compounded by U.S. CPI data that reduced the likelihood of a significant 50 basis point Fed rate cut next week. This rate convergence between the UK and U.S. could keep GBP under pressure. While the UK data did not impact expectations for a September Bank of England rate cut, it may heighten dovish sentiment among BoE members and align BoE-Fed rate-cut expectations more closely. Immediate resistance can be seen at 1.3110(Daily high), an upside break can trigger rise towards 1.3156(23.6%fib).On the downside, immediate support is seen at 1.3034(38.2%fib), a break below could take the pair towards 1.3000(psychological level).

USD/CAD: The Canadian dollar rebounded from a three-week low against the U.S. dollar on Wednesday as oil prices rallied, despite U.S. inflation data tempering expectations for a significant interest rate cut by the Federal Reserve. The recovery in oil prices, a major export for Canada, came as a drop in U.S. crude inventories and concerns about potential disruptions to U.S. output from Hurricane Francine offset worries about weak global demand. Meanwhile, U.S. consumer prices edged up in August, but persistent underlying inflation, driven by rising costs for housing and other services, reduced hopes for a half-point interest rate cut by the Federal Reserve next week. The loonie   was last trading 0.2% higher at 1.3580 to the U.S. dollar.Immediate resistance can be seen at 1.3624 (38.2%fib), an upside break can trigger rise towards 1.3692(23.6%fib).On the downside, immediate support is seen at 1.3627(50%fib), a break below could take the pair towards 1.3511 (61.8%fib).

USD/JPY: The dollar rebounded against the yen on Wednesday after U.S. inflation data bolstered expectations for a modest 25 basis point rate cut by the Federal Reserve at its upcoming policy meeting. The Labor Department's Consumer Price Index (CPI) revealed an annual inflation rate that dropped to a cooler-than-expected 2.5%, down 40 basis points. However, the core CPI, excluding food and energy, showed a higher-than-expected monthly increase of 0.3% and an annual rise of 3.2%. Financial markets have largely priced in an 83% probability for a 25 basis point rate cut at next week's Fed meeting, with only a 17% chance for a 50 basis point cut, according to CME's FedWatch Tool. Strong resistance can be seen at 143.71 (Sep 9th high), an upside break can trigger rise towards 145.00 (Psychological level). On the downside, immediate support is seen at 141.90(23.6%fib), a break below could take the pair towards 141.49 (Lower BB).

Equities Recap

European shares closed flat on Wednesday, with gains in technology stocks balanced by declines in real estate shares. Investors shifted their focus to the European Central Bank, awaiting its rate decision on Thursday.

UK's benchmark FTSE 100 closed down by 0.78 percent, Germany's Dax ended down  by 0.96 percent, France’s CAC finished the day down by 0.24 percent.

All three major U.S. stock indexes closed higher on Wednesday, driven by gains in the technology sector. This recovery offset investor disappointment from an early morning inflation report, which dampened hopes for a 50 basis point interest rate cut by the Federal Reserve next week.

Dow Jones closed down  by  0.23% percent, S&P 500 closed up by 0.45% percent, Nasdaq settled up by 0.84%  percent.

Commodities Recap

Gold prices fell on Wednesday as the dollar and Treasury yields strengthened following U.S. inflation data. The data led investors to adjust their expectations, reducing the likelihood of a substantial rate cut by the Federal Reserve next week.

Spot gold   was down 0.1% at $2,513.19 per ounce at 1:46 p.m. ET (1746 GMT).U.S. gold futures  settled mostly unchanged at $2,542.40.

Oil prices recovered by 2%   as a fall in U.S. crude inventories and concern about Hurricane Francine disrupting U.S. output countered concerns about weak global demand.

Brent crude futures rose 2% to $70.64 a barrel, and U.S. West Texas Intermediate (WTI) crude rose 2.25% to $67.21.