ECB Keeps September Guessing (07.24.2026)

Higher oil prices lifted inflation expectations, pushing the probability of a September Fed rate hike to 78%.

Gold fell below $4,100, silver slipped under $59, the US 100 Tech Index dropped 1.87%, and Bitcoin lost 1.47% as higher-for-longer rate expectations weighed on sentiment.

The euro weakened after the ECB left rates unchanged, sterling fell as markets priced further BOE tightening, and the yen hit a four-decade low despite rising BOJ hike expectations. Meanwhile, the offshore yuan outperformed, supported by record Hong Kong yuan deposits and the PBOC's strongest fixing since February 2023.

Euro Awaits the Next Move

The euro fell below $1.139 after the ECB left interest rates unchanged, as expected. Policymakers maintained a cautious, data-dependent stance, noting that softer inflation, slower wage growth, weaker activity, and lower inflation expectations have reduced the need for further tightening. However, the recent oil rally driven by Middle East tensions has revived inflation concerns. Even so, markets continue to price in at least two ECB rate cuts by year-end, with September fully priced.

The first resistance is positioned at 1.1450 while the support starts from 1.1360.

Oil Clouds Gold's Shine

Gold slipped below $4,100 an ounce, retreating from two-week highs as higher oil prices strengthened expectations that the Fed could keep rates elevated for longer. Iran-backed Houthis claimed attacks on two Saudi tankers, while a 12th straight night of US strikes on Iran raised concerns over prolonged disruptions to Gulf oil exports. Markets now see a 78% chance of a September Fed rate hike.

First resistance is seen at $4100, with initial support near $4050.

Yen Ignores Intervention Talk

The yen weakened to around 163.3 per dollar, its lowest level in four decades, despite growing expectations of faster BOJ tightening and repeated intervention warnings. Reports pointed to rising inflation risks in Japan, while Finance Minister Satsuki Katayama reiterated that authorities stand ready to act if needed. A strong dollar, Japan's low interest rates, uncertainty over government policy, and rising oil prices continue to pressure the currency.

Initial resistance stands at 164.00, while the first support is at 163.30.

Pound Feels the Oil Pressure

Sterling slipped to $1.336, its lowest level in ten days, as investors weighed new UK fiscal measures against persistent inflation risks. Finance Minister John Healey warned of rising business costs, while Prime Minister Andy Burnham announced a 20% cut in business rates for pubs, clubs, and live music venues from April. With oil near two-month highs, markets now price in almost two BOE rate hikes by year-end.

Resistance stands at 1.3340, while support is 1.3300.

Silver Retreats with Gold

Silver eased below $59 an ounce after reaching a two-week high as rising oil prices reinforced inflation concerns and expectations for tighter Fed policy. Houthi attacks on two Saudi tankers and continued US strikes on Iran added to fears of prolonged supply disruptions. Markets currently assign a 78% probability to a September Fed rate hike.

Resistance stands at $58.50, while support is $57.20.