FxWirePro: AUD/USD gains modestly as Geopolitical risks keep markets cautious 
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Market Roundup
• French Industrial Production (MoM) (Jul) -0.4%, 0.2% forecast, -0.1% previous
•Greek Credit Expansion (YoY) (Jul) 3.4%, 4.6% previous
•Greek HICP (YoY) (Aug) 3.7%, 2.7% previous
•Greek CPI (YoY) (Aug) 3.8%, 3.4% previous
•US ADP Employment Change Weekly 10.00K, 11.80K previous
•US ADP Employment Change Weekly 12.00K, 10.00K previous
•US Redbook (YoY) 8.3%, 9.6% previous
Looking Ahead Economic Data (GMT)
• 17:00 US 10-Year Note Auction 4.683% previous
Looking Ahead Events And Other Releases (GMT)
• 17:00 German Buba President Nagel Speaks
•17:00 ECB President Lagarde Speaks
Currency Forecast
EUR/USD : The euro firmed against the U.S. dollar on Wednesday as investors positioned for a widely anticipated 25-basis-point rate hike by the European Central Bank on Thursday. The ECB is expected to lift its deposit rate to 2.50%, with policymakers leaning toward tighter monetary policy as the prolonged U.S.-Iran conflict keeps energy prices elevated and inflationary pressures persistent.The ECB last raised its deposit rate to 2.25% in June before keeping policy unchanged in July. Fresh inflation data has reinforced expectations for another hike, with eurozone inflation accelerating to 3.3% in August from 2.9% in July. Energy inflation also climbed sharply to 14.3% from 10.3%, adding to concerns over persistent price pressures.Markets will now focus on the ECB's guidance on the path for interest rates beyond September. While the September hike is fully priced in, economists largely expect it to be the final increase. However, some economits are now anticipating another hike in December if elevated energy prices continue to drive inflation higher.Immediate resistance can be seen at 1.1641(38.2%fib), an upside break can trigger rise towards 1.1677(Aug 28th high).On the downside, immediate support is seen at 1.1612(Daily low), a break below could take the pair towards 1.1585(38.2%fib).
GBP/USD: The British pound neared two week high against the U.S. dollar on Wednesday as the greenback remained under pressure, while traders assessed surging oil prices nearing $100 a barrel amid escalating tensions in the Middle East.Iranian-backed Houthi forces in Yemen launched strikes on several Saudi Arabian cities, further drawing the U.S. ally into the widening conflict. Meanwhile, U.S. forces targeted several Iranian oil tankers, while Tehran launched an attack on a U.S. base in Jordan.Investors are also focused on key U.S. inflation data and UK economic growth figures due this week, which could influence expectations for the monetary policy paths of the Federal Reserve and Bank of England. Markets are currently pricing in around a 60% chance of a Fed rate hike next week, while the BoE is widely expected to keep interest rates unchanged. Immediate resistance can be seen at 1.3556(SMA 20 ), an upside break can trigger rise towards 1.3655(23.6%fib).On the downside, immediate support is seen at 1.3535(38.2%fib), a break below could take the pair towards1.3483(Sep 2nd low).
AUD/USD: The Australian dollar advanced on Wednesday as increasingly hawkish signals from the Reserve Bank continued to reinforce expectations for another rate hike this month.Markets are pricing a 72.9% probability of a 25-bps RBA rate hike in September, as persistent inflation pressures keep expectations for further policy tightening elevated.RBA Deputy Governor Andrew Hauser said the board will debate a September rate hike, with inflation remaining a key concern. He also highlighted risks from the Middle East conflict, supply constraints and a global AI-driven boom.Attention will shift to U.S. August PPI on Thursday and CPI on Friday, with markets watching closely for evidence that rising energy prices are feeding into inflation. Immediate resistance can be seen at 0.7250(Higher BB), an upside break can trigger rise towards 0.7276(23.6%fib).On the downside, immediate support is seen at 0.7217 (Daily low), a break below could take the pair towards 07168(38.2%fib)
USD /JPY :The U.S. dollar extended declined on Wednesday as the yen continued firm amid growing expectations that the Bank of Japan could accelerate the pace of policy tightening. Traders widely expect the BOJ to raise rates by 25 basis points at its September 17 and 18 meeting, but the rally will hinge on whether Governor Kazuo Ueda follows through with hawkish comments.In the past, BOJ officials stressed the need to move cautiously to avoid cooling sentiment in an economy that had been mired in deflation for nearly three decades.In recent months, however, more acute price pressures arising from sharp yen declines have created a greater sense of urgency in Japan. Immediate resistance can be seen at 154.04(Daily high), an upside break can trigger rise towards 155.10(38.2%fib).On the downside, immediate support is seen at 152.95(Daily low) a break below could take the pair towards 152.00 (Psychological level).
Equities Recap
European shares declined on Wednesday as escalating tensions in the Middle East heightened inflation concerns and dampened investor risk appetite for risk.
UK's benchmark FTSE 100 was down by 1.02 percent, Germany's Dax was up by 1.70 percent, France’s CAC was down by 1.52 percent.
Commodities Recap
Brent crude futures breached $100 a barrel on Wednesday for the first time since July 24, as escalating attacks across the Middle East, including strikes on oil tankers, heightened concerns over supply disruptions and dashed hopes for a normalization of oil shipments in the region.
Front-month Brent crude futures were up $2.74, or 2.8%, at $100.66 a barrel by 1315 GMT, after earlier touching $100.95. U.S. West Texas Intermediate crude was up $2.74, or 3%, at $95.77 a barrel, its highest level since early June.
Gold prices climbed on Wednesday, supported by a weaker U.S. dollar, as investors assessed renewed inflationary pressures from escalating tensions in the Middle East. Market attention remained focused on upcoming U.S. inflation data, which could provide fresh clues on the Federal Reserve’s interest-rate outlook.
Spot gold rose 1.1% to $4,401.60 per ounce by 1116 GMT, while U.S. gold futures for December delivery gained 0.1% to $4,445.30.
