Daily Forex Analysis

Markets showed cautious strength in early August as expectations for U.S. interest rate cuts continued to grow following weaker labor data and renewed tariff threats. 

Global markets are locked on the Federal Reserve as softer U.S. jobs and services data reignite hopes for rate cuts, lifting the euro above $1.1570 and driving gold and silver to multi-week highs.

EUR/USD held steady near 1.1557, struggling to break past 1.1600 as skepticism lingered over the U.S.-EU trade deal’s fairness.

The euro and silver climbed on Monday as weak U.S. jobs data increased expectations for a September Fed rate cut. Nonfarm payrolls came in far below forecasts, while prior months saw downward revisions. The soft data pushed odds of a rate cut to 75%, weakening the dollar and lifting risk-sensitive assets. 

The U.S. dollar extended its gains on Friday as strong economic data and renewed trade tensions supported demand. President Trump’s announcement of new global tariffs and solid U.S. inflation figures lifted the greenback across the board. 

The U.S. dollar extended its strength after the Federal Reserve kept interest rates unchanged and signaled no immediate plans to ease, pressuring major currencies and precious metals. The euro fell to its lowest level since mid-June, while the British pound dropped toward a 2.5-month low. 

Markets entered a holding pattern on Wednesday as traders positioned themselves ahead of the Federal Reserve’s policy decision. 

The U.S. dollar extended its gains on Tuesday, weighing on major currencies and precious metals as markets digested recent trade developments and looked ahead to this week’s Federal Reserve policy decision.