Dollar Plunges to Multi-Day Lows Ahead of Crucial NFP Data
The US Dollar has continued its downward trend, breaching below the key 200-day SMA and falling to multi-day lows. This marked decline is largely attributed to rising market chatter over an imminent rate hike by the Bank of Japan (BoJ). As a result, geopolitical concerns and caution ahead of the Nonfarm Payrolls data have taken a backseat.
The US Dollar Index (DXY) has broken below the 99.00 support level, leaving its significant 200-day SMA behind. The Nonfarm Payrolls will be the main event to watch at the end of the week, accompanied by the Unemployment Rate and wage inflation data.
Currency pairs have responded accordingly, with EUR/USD surging past the 1.1600 mark to hit four-day highs due to the dollar's weakness. GBP/USD has also reclaimed the 1.3550 region, while USD/JPY has collapsed to levels last seen in early August near 155.00.
AUD/USD has added to its previous day's advance, marginally exceeding the key 0.7200 hurdle. WTI prices have surpassed $93.00 per barrel for the first time since late July, underpinned by escalating tensions on the US-Iran-Hormuz front and the marked sell-off in the Greenback.