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Gold clings to its previous day’s gains on Friday ahead of the United States (US) Nonfarm Payrolls (NFP) data for August, which will be published at 12:30 GMT.

Soft US ADP data sets challenging stage for US NFPAhead of the US NFP data, weak US ADP Employment Change data for August has set an unfavorable backdrop. The data showed on Wednesday that US private payrolls rose by 38K, the weakest pace since February and were below market expectations of 46K.

Looking ahead to the official labour market report, TD Securities says, "We expect August NFP to rebound to 95k after July posted a decline of 23k," and stresses that "risks to our payrolls forecasts appear hawkish, and we would not rule out an outsized positive surprise." On the jobless rate, the bank expects limited movement, noting that "the UE rate likely went sideways at 4.1% with balanced risks." TD Securities concludes that "a modestly hawkish employment report will reaffirm the Fed's attention on inflation, but it will be by itself unlikely to push the Committee towards hikes."

The US official employment data is expected to have a significant influence on the Federal Reserve’s (Fed) monetary policy outlook, which could drive the next move in the Gold price.

Traders push back Fed interest rate hike bets Currently, traders have trimmed hawkish Fed bets after comments from Fed Governor Christopher Waller at the Reuters NEXT Newsmaker event on Thursday, in which he appeared confident about price pressures deflating recently.

The CME FedWatch tool shows that the odds of the Fed hiking interest rates in the September meeting have diminished to 50% from 63.2% seen on Wednesday.

“Finally seeing some signs of disinflation in recent data," Fed’s Waller said, and added, “If August Consumer Price Index (CPI) data confirms inflation pressures are cooling off, he would incline to support holding the policy rate steady at the September policy meeting.”

Fed’s Waller didn’t rule out the possibility of a small adjustment in monetary policy "if August inflation data shows progress has reversed”.

On the geopolitical front, elevated oil prices due to interrupted global energy supply in the wake of Middle East tensions could limit the upside in the Gold price.

This week, military aggression between the US and Iran resumed, following weeks of relative calm, as the US Central Command (CENTCOM) struck Iranian rocket launchers that were preparing to send mines into the Strait of Hormuz, a critical passage to almost one-fifth of global energy supply.

Gold Technical Analysis

In the daily chart, XAU/USD trades at $4,469.86, retaining a bullish near-term bias as spot holds above the 100-day simple moving average (SMA) at roughly $4,354.56.

The price structure suggests buyers remain in control while the Relative Strength Index (RSI) near 55 hints at modest positive momentum without yet reaching overbought territory.

On the downside, immediate support is aligned with the 100-day SMA around $4,354.56, where a decisive break could expose deeper corrective pressure toward prior reaction lows at around $4,300. Looking up, the August high at around $4,697 seems the key hurdle for the precious metal.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

The AUD/JPY cross trades in positive territory near 112.80 during the early European trading hours on Friday. However, the potential upside for the cross might be limited as traders ramped up bets on a Bank of Japan (BoJ) interest rate hike, boosting the Japanese Yen (JPY). 

BoJ board member Hajime Takata said on Wednesday that the central bank should conduct interest rate hikes nimbly to counter intensifying inflationary pressures, rather than adhere to a fixed semiannual pace anticipated by markets. Analysts believe the Japanese central bank could be more hawkish than previously expected when it meets on September 17 to 18.

“This feels less like a short squeeze and more like the market cautiously reassessing a more hawkish BOJ path,” said Masahiko Loo, senior fixed income strategist at State Street Investment Management in Tokyo. “Markets are finally starting to buy into the idea that Japan may continue normalizing policy into 2027,” Loo added.

Yen outlook tempered as BNY questions power of intervention aloneStrategists at BNY caution that, despite recent official action, they "remain skeptical that Japanese authorities can generate sustained JPY appreciation through intervention alone." They argue that the government’s policy stance "remains reflationary," and that "today’s backdrop is very different from the early Abenomics period: inflation is already materially higher and structural reform is less prominent." Even so, BNY stresses that this does not automatically imply further currency weakness, noting that "does not mean the yen must weaken further."

Technical Analysis: AUD/JPY remains capped under the 100-day SMAIn the daily chart, AUD/JPY holds a bearish near-term tone as it slips beneath the 100-day simple moving average (SMA) and the Bollinger middle band. This positioning suggests rallies are being capped by the cluster of overhead averages, while the Relative Strength Index (14) around 45 hints at fading upside momentum rather than outright oversold conditions.

On the topside, initial resistance comes at the 100-day SMA around 113.20, followed closely by the Bollinger middle band near 113.40. A sustained break above these levels would be needed to ease the current downside pressure, with the upper Bollinger band near 115.05 as a more distant cap. 

On the downside, the lower Bollinger band, now sitting near 111.80, acts as the next key support zone. Any follow-through selling below this level could expose the July 3 low of 111.33, followed by the August 4 low of 110.01. 

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Australian Dollar FAQs One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.

The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.

China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.

Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.

The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.

EUR/JPY continues to present a clear risk of a larger‑degree correction against the cycle that began at the February 2025 low. The internal structure of this pullback is forming as a double three, which is consistent with the broader corrective tone in the cross. The decline to 179.37 completed wave (W), and the subsequent advance in wave (X) reached 186.04. That pivot now serves as the key level that defines the corrective sequence. With wave (X) in place, wave (Y) has started to unfold as a zigzag. Down from the wave (X) peak, wave ((i)) ended at 184.91, and the recovery in wave ((ii)) reached 185.98.

The pair has since resumed lower in wave ((iii)), and the internal form shows a nested impulsive decline. Down from wave ((ii)), wave (i) ended at 183.61, followed by a modest rally in wave (ii) that reached 184.20. The move in wave (iii) extended to 180.51 and reinforced the impulsive character of the sequence. A wave (iv) rally is now in progress as the market works to correct the cycle from the September 2 high. This bounce should remain corrective and is expected to unfold in either three or seven swings.

As long as the 186.04 pivot holds, the broader expectation favors a failure in the current rally. That outcome would allow the pair to resume lower and complete wave (Y) within the larger‑degree correction.

EUR/JPY 60 minute Elliott Wave chart

EURJPY continues to present a clear risk of a larger‑degree correction against the cycle that began at the February 2025 low. The internal structure of this pullback is forming as a double three, which is consistent with the broader corrective tone in the cross. The decline to 179.37 completed wave (W), and the subsequent advance in wave (X) reached 186.04. That pivot now serves as the key level that defines the corrective sequence. With wave (X) in place, wave (Y) has started to unfold as a zigzag. Down from the wave (X) peak, wave ((i)) ended at 184.91, and the recovery in wave ((ii)) reached 185.98.

The pair has since resumed lower in wave ((iii)), and the internal form shows a nested impulsive decline. Down from wave ((ii)), wave (i) ended at 183.61, followed by a modest rally in wave (ii) that reached 184.20. The move in wave (iii) extended to 180.51 and reinforced the impulsive character of the sequence. A wave (iv) rally is now in progress as the market works to correct the cycle from the September 2 high. This bounce should remain corrective and is expected to unfold in either three or seven swings.

As long as the 186.04 pivot holds, the broader expectation favors a failure in the current rally. That outcome would allow the pair to resume lower and complete wave (Y) within the larger‑degree correction.

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EUR/JPY gains ground after two days of losses, trading around 181.50 during the Asian hours on Friday. Technical analysis of the daily chart indicates the currency cross remains within the descending channel pattern, signalling a bearish bias.

However, the EUR/JPY cross is maintaining a bearish near-term bias as it remains below the nine- and 50-day Exponential Moving Averages (EMAs). The pair has retreated from recent highs with price now trapped under this clustered dynamic resistance, while the 14-day Relative Strength Index (RSI) is hovering just above 30, hinting at lingering downside pressure despite approaching oversold conditions.

The EUR/JPY cross may test the immediate support at the lower boundary of the descending channel around 180.70. A break below the channel would strengthen the bearish bias and put downward pressure on the cross to navigate the region around the nine-month low of 179.37, recorded on August 3.

On the upside, the EUR/JPY cross could target the initial barrier at the nine-day EMA of 183.74, followed by the 50-day EMA of 184.56. Further resistance lies at the upper boundary of the descending channel around 185.80. A break above the channel could support the currency cross to reach the all-time high of 187.95 set on April 17.

Yen surge fuels talk of BoJ interventionStrategists at Scotiabank highlight that the Yen has mounted a sharp rebound against the Dollar, noting that “the yen is up a shocking 1.5% vs. the USD, building on Wednesday’s impressive gains that sparked renewed speculation around the possibility of official intervention.” They point out that the latest advance extends the recent bout of Yen strength and is reinforcing market chatter that Japanese authorities may be edging closer to stepping in if currency moves become disorderly.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the Japanese Yen.

USDEURGBPJPYCADAUDNZDCHFUSD-0.00%-0.03%0.20%-0.03%-0.08%-0.29%0.07%EUR0.00%-0.04%0.20%0.00%-0.10%-0.26%0.07%GBP0.03%0.04%0.23%0.04%-0.05%-0.23%0.10%JPY-0.20%-0.20%-0.23%-0.21%-0.30%-0.48%-0.15%CAD0.03%-0.00%-0.04%0.21%-0.09%-0.28%0.07%AUD0.08%0.10%0.05%0.30%0.09%-0.18%0.15%NZD0.29%0.26%0.23%0.48%0.28%0.18%0.33%CHF-0.07%-0.07%-0.10%0.15%-0.07%-0.15%-0.33% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

Silver (XAG/USD) edges lower during the Asian session on Friday, snapping a two-day winning streak to the weekly high set the previous day. The white metal, however, lacks bearish conviction and currently trades below the $67.00 mark, down 0.30% for the day, as traders await the release of the closely watched US Nonfarm Payrolls (NFP) report.

Heading into the key data risk, receding bets for an interest rate hike by the US Federal Reserve (Fed) in September and sliding US bond yields keep the US Dollar (USD) near its lowest level in over a week. This, in turn, is seen as a key factor acting as a tailwind for USD-denominated commodities, including the XAG/USD. That said, the technical setup warrants some caution for bullish traders and positioning for an extension of this week's goodish rebound from the $63.30 area.

The XAG/USD trades below the 200-day Simple Moving Average (SMA) at $72.84 and the mid-range Fibonacci retracement level of the May-July decline. Moreover, mixed technical momentum indicators suggest that rallies remain capped for now. In fact, the Relative Strength Index hovers in the mid-50s and the Moving Average Convergence Divergence (MACD) slips into negative territory, hinting at waning upside pressure and validating the near-term cautious outlook.

On the topside, immediate resistance emerges at the 38.2% retracement at $67.83, followed by a more significant barrier at the 50.0% retracement at $71.89 and the 200-day SMA at $72.84. A sustained strength above this cluster would be needed to ease the broader downside bias and expose the 61.8% level near $75.95. On the downside, initial support is seen at the 23.6% Fibo. level at $62.81, with a deeper floor at the prior cycle low around the 0.0% retracement at $54.69, where buyers would be expected to re-emerge if selling accelerates.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

XAG/USD daily chart

Silver FAQs Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.

Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.

Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.

Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.

On Friday, the People’s Bank of China (PBOC) sets the USD/CNY central rate for the trading session ahead at 6.7787 compared to the previous day's fix of 6.7807 and 6.7098 Reuters estimate.

PBOC FAQs The primary monetary policy objectives of the People's Bank of China (PBoC) are to safeguard price stability, including exchange rate stability, and promote economic growth. China’s central bank also aims to implement financial reforms, such as opening and developing the financial market.

The PBoC is owned by the state of the People's Republic of China (PRC), so it is not considered an autonomous institution. The Chinese Communist Party (CCP) Committee Secretary, nominated by the Chairman of the State Council, has a key influence on the PBoC’s management and direction, not the governor. However, Mr. Pan Gongsheng currently holds both of these posts.

Unlike the Western economies, the PBoC uses a broader set of monetary policy instruments to achieve its objectives. The primary tools include a seven-day Reverse Repo Rate (RRR), Medium-term Lending Facility (MLF), foreign exchange interventions and Reserve Requirement Ratio (RRR). However, The Loan Prime Rate (LPR) is China’s benchmark interest rate. Changes to the LPR directly influence the rates that need to be paid in the market for loans and mortgages and the interest paid on savings. By changing the LPR, China’s central bank can also influence the exchange rates of the Chinese Renminbi.

Yes, China has 19 private banks – a small fraction of the financial system. The largest private banks are digital lenders WeBank and MYbank, which are backed by tech giants Tencent and Ant Group, per The Straits Times. In 2014, China allowed domestic lenders fully capitalized by private funds to operate in the state-dominated financial sector.

The silver price gained 15.6% in August, beating gold and major equity benchmarks in Deutsche Bank's selected cross-asset performance table. The silver price in US Dollars rose over 15% in August, topping Deutsche Bank's selected cross-asset table and comfortably outperforming gold and major equity markets.

Our own XAG/USD data recorded a monthly gain of 15.5%, with silver climbing from around $57.65 to $66.58.

Gold prices gained 9.7% in Deutsche Bank's comparison, while the KOSPI advanced around 9% and the S&P 500 returned 2.7%.

Silver therefore beat gold by almost six percentage points and outperformed the S&P 500 by nearly 13 points.

Image: XAG/USD 48-hr chart The latest 48-hour chart shows silver recovering from $63.40 to around $66.32, leaving the metal 2.5% above its opening level despite sharp swings.

Silver Price Tops Deutsche Bank's August Table Deutsche Bank described August as a broadly positive month for financial markets.

“At first glance, August was a solid month. There was no late-summer wobble of the sort seen in recent years, and the economic data remained strong.”

Stocks benefited from resilient economic figures and a strong company earnings season, but their returns were well below silver's.

“That resilient macro backdrop, combined with a strong earnings season, helped equities deliver solid gains. The S&P 500 returned +2.7% over the month, with technology stocks leading the way as the Magnificent 7 rose +4.4%.”

Even the Magnificent Seven's 4.4% return was less than one-third of silver's advance.

The KOSPI came closest among the major equity benchmarks in the chart, while gold finished second overall at just under 10%.

Treasury Buybacks Lift Precious Metals Deutsche Bank connected the precious-metals rally with concerns about financial repression after the US Treasury announced increased purchases of longer-dated government debt.

“That was partly due to the US Treasury Department’s announcement that it would increase buybacks of longer-dated Treasuries. The move prompted a temporary pullback in longer-dated US yields, but renewed concerns about financial repression also helped lift gold prices by +9.7% in August, while silver gained +15.6%.”

The August rally was not a straight line.

Silver reached a monthly high above $71 before retreating, and the metal fell 3.6% on 1 September as changing Federal Reserve expectations triggered another bout of volatility.

Prices have since rebounded above $66, although XAG/USD remains below its late-August peak.

That choppy performance follows the sharp swings discussed in our earlier coverage of gold and silver prices after Fed hike risks returned.

Deutsche Bank's ranking applies only to the selected financial assets in its chart.

Some agricultural commodities discussed separately performed even better, with sugar up 21.5%, wheat gaining 18.3% and corn rising 16.8%.

Silver's next moves will depend on Federal Reserve rate expectations, the US Dollar and changes in long-dated Treasury yields.

Investor demand, precious-metals flows and the market's response to upcoming US employment and inflation data will also determine whether the August outperformance can be sustained.

A combination of suspected intervention from Japan's Ministry of Finance, coupled with less hawkish remarks from senior FOMC officials that contrast with those delivered by Chair Kevin Warsh at Jackson Hole last Friday, has helped deliver a powerful bearish break in USD/JPY, sending the pair back to the levels seen around the lows of the intervention episode in late July and early August.

Spot gold daily chart shows larger trend structure. Source: TradingView Next Test Could Shift Long-Term Outlook Altogether, recent technical signals show the possible beginning of an uptrend. If gold can now rise above and stay above the 200-day moving average near $4,534, the long-term picture should improve. That would likely lead to a continuation of the current advance above last week’s high of $4,697, thereby triggering a continuation of the developing advance.

ABCD Pattern Points Toward $4,984 With a new swing low, a potential rising ABCD pattern has formed, which shows an initial 100% projected target near $4,984. That is where there will be symmetry in price between the two legs up from the recent bottom. Typically, that projection identifies a minimum resistance target derived from the rising ABCD pattern. Given the potential upside indicated by the pattern, two lower targets become more likely to be reached.

There is the 50% retracement of the prior full decline at $4,771, and the 61.8% Fibonacci retracement at $4,852. Both of those areas are reinforced by a prior lower swing high, with the higher level showing greater significance given the series of lower swing highs in the prior downtrend.

The Netherlands moved approximately 86 tonnes of gold valued at over €10 billion from North America to London, citing “increasing geopolitical unrest” and a desire to “strengthen crisis preparedness.”

The country joins a growing list of countries moving gold out of the U.S to reduce counterparty risk.

According to a statement from De Nederlandsche Bank (DNB), it sold 59 tonnes of gold stored in New York and used the funds to purchase gold in London “that meets the international market standards.” It also physically moved more than 27 tonnes of gold from the U.S. and Canada to Zeist, simultaneously transferring a similar amount of gold from Zeist to London to avoid remelting bars.

“Combining the processes of buying and selling and physical transport has allowed DNB to spread the risks associated with such a complex physical gold relocation operation, while also ensuring efficiency and cost-consciousness.”

The statement said the operation also served as crisis preparation.

“Moreover, experience of both approaches will be useful in the event that another relocation is required during a potential future crisis, and one of the two approaches proves impossible due to circumstances at the time. This also fits in with DNB’s efforts to increase its crisis preparedness.”

The Netherlands holds 612.4 tonnes of gold in its reserves. According to the DNB, about 18 percent of its gold remains in the U.S., with another 18 percent stored in Canada. Thirty-two percent of its gold reserves are now stored in London, with 31 percent stored within the country’s borders.

Based on the DNB’s statement, it’s clear that worries about access to its gold were a primary reason for the move.

“Gold that is held with the Bank of England must meet modern international trade standards and is regarded as the world's most easily tradable gold and will therefore be the most readily available for DNB in a crisis situation. The gold reserves held in New York and Ottawa cannot be utilized as quickly and directly in such a situation.”

A broader trend: We don't trust AmericaNotably, countries with historically friendly relations like the Netherlands are beginning to judge the U.S. as a political risk.

As the Financial Times reported, “The transfer follows calls from European politicians and taxpayer lobbyists to repatriate gold reserves from the U.S., warning that an unreliable American government under President Donald Trump may otherwise seize them amid growing transatlantic tensions.”

France completed a gold repatriation project earlier this year. The Banque de France (BdF) unloaded “non-standard” gold bars of varying purity and size that were stored in New York. The central bank used the proceeds to purchase new gold bars that meet international reserve standards for weight, purity, and certification. Think of it as exchanging “junk silver” for pure .999 silver coins.

The upgraded gold will remain safely within French borders.

At the time, Metals Focus senior analyst Junlu Liang said these gold movements show how central banks are reassessing the role of gold in reserve management.

“In some countries, domestic political considerations have further strengthened calls to relocate gold holdings closer to home.”

There have also been calls for gold repatriation from German politicians spanning the political spectrum. The Bundesbank brought half of its gold home in 2013, moving 674 tonnes of gold from Paris and New York back to Germany. However, the Bundesbank still stores about one-third of its gold in New York vaults.

Earlier this year, Emanuel Mönch, a leading German economist and former Bundesbank head of research, said it’s “too risky” to keep gold reserves in New York.

“Given the current geopolitical situation, it seems risky to store so much gold in the U.S. In the interest of greater strategic independence from the U.S., the Bundesbank would therefore be well-advised to consider repatriating the gold.”

India is another country aggressively repatriating its gold. In the spring of 2024, the Reserve Bank of India brought 100 tonnes of gold home, repatriating it from vaults in the UK. Over the last six months, the Indian central bank has repatriated another 104 tonnes.

Based on data from the Management of Foreign Exchange Reserves, India now has about 680 tonnes of its 880.52-tonne gold reserves (77 percent) stored within its borders. Approximately 197.67 tonnes remain stored in vaults at the Bank of England and the Bank for International Settlements. 

According to the Economic Times of India, the weaponization of the dollar by the U.S. is one of the key factors driving gold repatriation, specifically aggressive sanctions levied on Russia after it invaded Ukraine and the freezing of Afghanistan’s reserves by Western powers.

“Those episodes, involving G7 countries restricting access to sovereign assets, have reshaped how central banks think about custody.”

According to the World Gold Council survey, the Bank of England remains the most popular overseas vaulting location. Fifty-seven percent of the central banks surveyed indicated they held some gold in the UK. That was down from 64 percent last year.

Domestic vaulting was the second-most popular option, with 49 percent expressing it as their preference.

The number of banks vaulting at least some gold in New York also dipped, falling from 17 percent last year to 14 percent before the Netherlands removed some of its gold.

The last two trading sessions have been particularly important for gold's price action in the short term. XAU/USD has gained more than 3.7% during this period, once again highlighting a meaningful bullish bias around the precious metal. For now, this recovery has been driven mainly by weakness in both the U.S. dollar and the bond market ahead of tomorrow's NFP release. Both markets remain important alternatives to gold, and their recent pullback appears to be allowing demand for the metal to recover. As long as this dynamic remains in place, buying pressure could continue to play an important role during the coming sessions.

How Is the Market Reacting Ahead of NFP?
Tomorrow, markets will focus on the release of the U.S. Non-Farm Payrolls (NFP) report, which measures changes in non-agricultural employment during August. Current expectations point to the creation of around 55,000 new jobs, a figure that would represent an improvement compared with July's reading, when approximately 23,000 jobs were lost.

However, beyond the headline number itself, what truly matters is the potential impact this report could have on the Federal Reserve's next monetary policy decision. At the moment, there is still no clear consensus regarding how the central bank will proceed at its mid-September meeting. While a more aggressive Fed was the dominant expectation just weeks ago, recent comments from policymakers have begun to support a more cautious approach.

Officials such as John Williams have indicated that they prefer to remain in a wait-and-see mode, highlighting that recent inflation data has been more encouraging. At the same time, Christopher Waller has suggested that he would support leaving rates unchanged if inflation continues to show signs of moderation.

This has increased uncertainty heading into the NFP report, as markets increasingly view the release as a potentially decisive factor for September's policy decision. In fact, CME Group probabilities currently show an almost evenly split scenario, with approximately 49% odds of rates remaining unchanged versus 51% odds of a rate increase. This reflects a decline in conviction around the idea of a clearly more hawkish Federal Reserve.

This uncertainty has already begun affecting markets that compete directly with gold. Both U.S. Treasuries and the dollar have reacted to recent Fed comments and to expectations surrounding the NFP release.

On one hand, 10-year Treasury yields have retreated from recent highs near the 4.8% area. On the other, the DXY Index, which measures the U.S. dollar against its major peers, has also moved back below the 99-point level. This highlights how sensitive both markets remain to monetary policy developments and suggests that investors are beginning to price in a less aggressive Fed scenario.

Source: Trading Economics

In this environment, the current dynamic remains particularly important for gold because weakness in alternative markets often supports a recovery in demand for the precious metal. This relationship becomes evident when comparing gold's performance with the DXY Index, where periods of dollar weakness continue to coincide with stronger price action in gold.

In addition, the correlation coefficient between both markets remains close to -0.93, reflecting a strong inverse relationship over the past 100 trading sessions. This suggests that continued dollar weakness may remain supportive of the recovery currently underway in gold. It is important to remember that correlation coefficients can change over time.

Source: TVC, StoneX, Tradingview

Against this backdrop, market attention will likely remain focused on how the Federal Reserve responds to tomorrow's labor market data. If job creation proves weaker than expected, the relative attractiveness of both bonds and the U.S. dollar could continue to decline, potentially extending buying pressure around XAU/USD. Conversely, if employment data shows significant strength, markets may begin reconsidering a more hawkish Fed outlook, which could push gold into a broader period of consolidation toward the end of the week.

Gold Technical Outlook

Source: StoneX, Tradingview

Trendline Continues Attempting to Hold: Recent gold price action continues to defend a long-term bullish trendline that remains one of the most important technical structures on the chart. As long as buying pressure remains stable and prices continue breaking through important technical barriers, a more established uptrend could begin to develop over the coming weeks.

 
RSI: The RSI has moved back above the neutral 50 level, signaling that average buying momentum is beginning to regain relevance within the market. If this dynamic continues to develop, the bullish bias could continue gaining importance in the short term.

 
MACD: However, it is also important to note that the MACD histogram continues to fluctuate near the neutral 0 line. This suggests that a degree of balance still exists within the average strength of short-term moving averages and indicates that the broader neutral environment has not disappeared completely from the chart.

 
Key Levels to Watch:

$4,530 – Critical Resistance: An important upside barrier that coincides with the 200-period Simple Moving Average. A sustained close above this level could begin to change the recent market structure and create room for stronger buying pressure during the coming sessions.

 
$4,332 – Nearby Barrier: An equilibrium area that has contained a large portion of price action over the last two weeks. It remains an important reference level for potential pullbacks and, as long as prices continue developing around this zone, a sideways environment could remain a relevant feature of the market.

 
$4,200 – Critical Support: This level coincides with the 50-period Simple Moving Average. Price action returning toward this area could begin to challenge the bullish structure that has developed recently and potentially open the door to a more dominant bearish bias in the weeks ahead.

 
Written by Julian Pineda, CFA, CMT – Market Analyst

Follow him on: @julianpineda25

Gold (XAU/USD) rallies more than 2% on Thursday following dovish comments by Federal Reserve (Fed) Governor Christopher Waller, who advocated holding rates steady if inflation data shows the disinflation process continues. At the same time, US data was mixed, with jobless claims remaining at familiar levels while business activity improved. At the time of writing, XAU/USD trades at $4,487.

XAU/USD jumps as Waller’s neutral tilt offsets firm services activityFed Governor Christopher Waller shifted to a more neutral stance, as he has been vocal about stubbornly high inflation. On Thursday, he said that if inflation cools, he will support keeping rates unchanged. However, he didn’t close the door on a hike if prices come hotter than foreseen.

In the meantime, the resumption of hostilities in the Middle East has weighed on the US Dollar, which has been pressured since Wednesday amid speculation of an intervention to boost the Japanese Yen.

The release of US jobs data on Thursday showed that the labor market is in a low-firing, low-hiring environment. Initial Jobless Claims for the week ending August 29 rose from 204K to 206K, a tick above the 205K projected by Wall Street’s economists.

The ISM Services PMI indicated business activity in the services sector is solid, though input costs remain high. The index rose to 55.4 from 54.1, exceeding estimates of 54.3. The Prices Paid sub-component jumped from 70.3 to 72.6, the highest since August 2022.

Given the backdrop, but mostly influenced by Waller’s comments, money markets priced in a lower chance that the Federal Reserve will raise interest rates by 25 basis points at the September 16 meeting. The odds stand at 54%, while for holding rates near 46%, according to Prime Terminal.

Source: Prime TerminalAhead, traders eye speeches by Cleveland Fed Beth Hammack and also Friday’s Nonfarm Payrolls for August, which are expected to improve from a -23K contraction to 56K, while the Unemployment Rate is foreseen at 4.1%, unchanged, compared to the previous print.

XAU/USD technical outlook: Gold reclaims $4,400, buyers target 200-day SMAGold price shifted gears and climbed above the September 1 high of $4,461, further accelerating toward $4,500 as traders stepped in amid broad US Dollar weakness.

Momentum has shifted to moderately bullish as depicted by the Relative Strength Index (RSI). The RSI signals that buyers are gaining strength, an indication that bullion prices might continue to trend higher.

If XAU/USD clears $4,500, the next resistance would be the 200-day Simple Moving Average (SMA) at $4.533. Once surpassed, the next stop is the $4,600 milestone, with the next area to watch being the August monthly high of $4,697.

Downwards, Gold’s first support is the $4,400 mark. Below that is the 100-day SMA at $4,358. On further weakness, the next floor level is $4,300, followed by the 50-day SMA at $4,232.

Gold daily chart Gold FAQs Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.

Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.

The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.

The trading week continues to be particularly relevant for the strength currently being displayed by the Canadian dollar. Over the last two trading sessions, USD/CAD has declined by approximately 0.7%, once again highlighting a bearish bias in favor of the Canadian currency.

XAU/USD Current Price: $4,492Fed Governor Christopher Waller cooled hopes for a September interest rate hike. The United States will publish the August Nonfarm Payrolls report on Friday.XAU/USD is up for a second consecutive day; bulls regained near-term control.The US Dollar (USD) remains under selling pressure on Thursday, as investors juggle with risk-related headlines and little guidance from macroeconomic data. Spot Gold benefited from broad USD weakness and surpassed the $4,500 level during American trading hours.

The USD traded with a firmer tone at the beginning of the week after the United States (US) and Iran resumed hostilities, sending Oil prices sharply up and hence raising concerns about mounting inflationary pressures. The Greenback, however, came under pressure mid-week amid speculation that the Bank of Japan (BoJ) intervened in the currency market to prevent the Japanese Yen (JPY) from falling further.

A better market mood kept the USD pressured despite the Middle East conflict. On the one hand, speculative interest welcomed headlines indicating that Russian President Vladimir Putin said there is a chance for constructive peace talks with Ukraine.

Finally, Federal Reserve (Fed) Governor Christopher Waller cooled the odds for a September rate hike, saying that officials can “wait one meeting,” as long as there are no surprises from upcoming inflation data, adding that a 25 bps hike won’t bring inflation back to 2%.

Data that can shape the upcoming Fed’s decision is around the corner: On Friday, the US will publish the August Nonfarm Payrolls (NFP) report, a picture of the situation in the labor market, while next week, the country will unveil the Consumer Price Index (CPI) for the same month.

XAU/USD Technical Outlook:

In the four-hour chart, XAU/USD turned bullish as it moved above the 20-period Simple Moving Average (SMA) at $4,397.48, the 100-period SMA at $4,481.65, and the 200-period SMA at $4,315.95. The moving averages are pretty much horizontal, failing to provide clear directional clues. Still, the price holding above them skews the risk to the upside. Technical indicators, in the meantime, gain upward traction above their midlines, maintaining nice vertical slopes, a sign of strong buying interest.

The XAU/USD pair daily chart keeps a constructive near-term tone as it holds above both the 20-day SMA at $4,462.49 and the 100-day SMA at $4,358.36. The Relative Strength Index (RSI) indicator ticks north at around 56, while the Momentum indicator also holds in positive territory, suggesting steady, rather than exuberant, upside pressure.

On the downside, immediate support is seen at the 100-period SMA at $4,481.65, followed by the 20-period SMA at $4,397.48 and then the 200-period SMA near $4,315.95. On the topside, the 200-day SMA at $4,533.34 forms the next significant resistance, and a sustained break above this barrier would likely open the door to further gains.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Japanese yen intervention risk is back after Tokyo ran a rate check, the step that usually comes before Japan acts in the market. Michael Boutros, StoneX Media Senior Market Analyst, walks through the Japanese yen across weekly, daily and four hour charts.

EUR/USD attracts buyers on Thursday as a sharp rally in the Japanese Yen (JPY), softer United States labour-market data and a pullback in US Treasury yields weigh on the US Dollar (USD). At the time of writing, EUR/USD trades around 1.1622, up roughly 0.30% on the day.

The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, trades around 99.00, near a one-week low, after reaching 99.86 on Wednesday, its highest level since August 14. Meanwhile, the benchmark 10-year US Treasury yield falls for the second consecutive day to around 4.74%, retreating from 4.81%, its highest level since October 2023.

Dovish comments from Federal Reserve (Fed) Governor Christopher Waller prompt traders to scale back bets on a rate hike this month. Waller said he is “finally seeing some signs of disinflation in recent data” and that the “rate decision in September hinges on August inflation.” He added that he would support keeping interest rates unchanged if the August data confirm recent progress.

Waller also said the Fed’s mandate is to achieve “price stability and full employment, not financial conditions,” adding that the current interest-rate setting “could get us back to 2% inflation.”

According to the CME FedWatch Tool, the probability of a rate hike at the Fed’s September 15-16 meeting has fallen to around 48% from 63% a day earlier.

Meanwhile, mixed US economic data offers conflicting signals. Initial Jobless Claims increased to 206K in the week ending August 29, slightly above the market forecast of 205K and the previous reading of 204K. However, the ISM Services PMI rose to 55.4 in August from 54.1 in July, exceeding expectations of 54.3. The Prices Paid and Employment indices increased to 72.6 and 47.8, respectively. Traders now await Friday’s Nonfarm Payrolls (NFP) report for fresh clues on the Fed’s monetary policy outlook.

Across the Atlantic, the European Central Bank (ECB) is widely expected to raise interest rates at next week’s monetary policy meeting. The move would mark the second rate hike this year as the central bank seeks to curb inflation, which has been driven largely by elevated Oil prices linked to the war in the Middle East.

A Reuters poll showed that all 65 economists surveyed expect the ECB to raise its Deposit Facility Rate by 25 basis points to 2.50% on September 10. Around 91% expect the rate to stay at 2.50% through the end of the year, while 78% see it holding at that level through mid-2027.

US Dollar Price Today The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the British Pound.

USDEURGBPJPYCADAUDNZDCHFUSD-0.29%-0.18%-2.02%-0.31%-0.28%-0.32%-0.59%EUR0.29%0.10%-1.75%-0.08%0.01%-0.10%-0.31%GBP0.18%-0.10%-1.85%-0.16%-0.09%-0.18%-0.41%JPY2.02%1.75%1.85%1.72%1.78%1.67%1.45%CAD0.31%0.08%0.16%-1.72%0.04%-0.06%-0.27%AUD0.28%-0.01%0.09%-1.78%-0.04%-0.08%-0.30%NZD0.32%0.10%0.18%-1.67%0.06%0.08%-0.19%CHF0.59%0.31%0.41%-1.45%0.27%0.30%0.19% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

$1.16238

+0.31%

EUR/USD, USD/CAD and USD/CHF forecast: Key reversal setups emerge as the dollar weakens ahead of NFP, with 1.1640, 1.3780 and 0.8050 in focus.

In this article:EUR/USD

+0.31%

EUR/USD ForecastUSD/CAD

-0.32%

USD/CAD ForecastUSD/CHF

-0.66%

EUR/USD Technical Analysis

EUR/USD price chart showing price at 1.16260, trading above both the 50 EMA (1.15961) and the 200 EMA (1.16130). Source: TradingView The Euro rose quite a bit in early trading on Thursday, but with the jobs report coming out, I’m watching the 1.1640 level. That was where we had seen that massive sell-off. I’m looking for signs of exhaustion to short this. Now, I don’t want to get married to this position. This is not going to be a long-term position by any stretch of the imagination, but I think it’s difficult to imagine a market that’s just truly going to fly ahead of that Nonfarm Payroll announcement. It could, obviously, but I’m looking for signs of exhaustion to start shorting.

USD/CAD Technical Analysis USD/CAD price chart showing price at 1.37935, trading below both the 50 EMA (1.38520) and the 200 EMA (1.38648). Source: TradingView The dollar against the Canadian dollar has fallen pretty significantly over the last couple of days, but we have a gap down here at 1.3780 that I’m watching very closely. If we get a bounce from here, I’m willing to go long. Now, keep in mind both of these countries produce their jobs report at the same time on Friday morning, so I’ll be out of this position no matter what it does before then.

With that being said, as long as we get some type of bounce, I’m willing to play that V-shaped pattern here as the interest rate differential continues to favor the United States despite the fact that rates have dropped a little bit early in the session.

USD/CHF Technical Analysis USD/CHF price chart showing price at 0.80707, breaking below the 200 EMA (0.80846) and the 50 EMA (0.81103). Source: TradingView Finally, the USD/CHF pair. This is one I’ve been long for a very long time. It is falling apart. Again, like the Euro, I’m kind of watching to see a little bit of exhaustion somewhere right around the 0.8050 level. I’ll be watching to see if we get a bounce. That’s a place I could go long. But again, I don’t want to be in the dollar when the Nonfarm Payroll announcement comes out. So all of these will be very short-term trades at best.

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Chris is a proprietary trader with more than 20 years of experience across various markets, including currencies, indices and commodities. As a senior analyst at FXEmpire since the website’s early days, he offers readers advanced market perspectives to navigate today’s financial landscape with confidence.

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Why Brent’s break above $97 is failing to lift Dollar, and why Japan, not oil, is setting today’s currency direction What’s happening: USD/JPY broke decisively through 157.99 to around 156, bringing the 155 area back into range, as Yen’s rally gathers fresh momentum from speculation that Japan’s roughly $2 trillion GPIF could raise its domestic bond allocation, on top of an already-hawkish BoJ repricing. At the same time, Brent climbed to an intraday high around $97.62, its strongest level in six weeks, as the US-Iran conflict shows signs of extending well beyond 2026.

Why it matters: Brent above $97 and a conflict that could extend into 2027 would normally form a potent Dollar-supportive combination through inflation and rates. Instead, Dollar is broadly weaker because Japan has taken control of the FX narrative. Oil is still setting global inflation risk, but today, Japan is setting currency direction.

Yen Takes Over as GPIF Speculation Adds to BoJ Repricing Yen extended its powerful rally on Thursday, sending USD/JPY decisively through 157.99 to around 156 and putting the 155 area back within reach. Latest leg appears to have received fresh fuel from speculation surrounding Japan’s roughly $2 trillion Government Pension Investment Fund. GPIF held an unusual management committee meeting on August 21, its first August meeting since 2019, and revisited discussion around its basic portfolio only five months after a March assessment concluded that a review was unnecessary.

Market interest centers on whether GPIF could eventually raise its strategic allocation to domestic assets, particularly government bonds. Domestic bonds currently carry a 25% target allocation, alongside 25% each for domestic equities, foreign bonds and foreign equities. The timing is significant because Japan’s 10-year government bond yield has climbed roughly one percentage point since March and briefly reached 3.015% this week, highest since 1996. Higher domestic yields are already changing relative attractiveness of Japanese assets, with Japanese investors reducing overseas bond exposure this year. A larger GPIF domestic allocation would reinforce that repatriation theme and potentially relieve some upward pressure on JGB yields.

That speculation is adding to a much broader Yen-positive repricing already underway. BoJ officials have become increasingly explicit about further tightening, with markets now focused not only on a possible September hike but on a faster cycle over coming year. Japan’s top currency diplomat Atsushi Mimura added another layer of caution Thursday, saying he was “neither satisfied nor reassured” by recent Yen developments and that authorities remained on “a state of heightened alert.” He declined to confirm whether officials had conducted a rate check. Traders nevertheless continue to attribute Yen strength primarily to BoJ tightening expectations rather than fresh intervention.

The 155 level is critical. USD/JPY is approaching the same territory reached after July’s record intervention campaign, which cost Japan roughly $96.5bn and included rare US participation. The 155.22 area marks July’s post-intervention low, while 155.01 provides nearby technical support. This time, however, pair is approaching those levels organically rather than through any confirmed official Yen buying.

Why the 155 Level Matters Japan’s 10-year JGB yield: briefly reached 3.015% this week, highest since 1996. July’s record intervention: cost roughly $96.5bn, included rare US participation. 155.22: July’s post-intervention low. 155.01: nearby technical support. Mimura: “neither satisfied nor reassured,” authorities on “a state of heightened alert.” July’s Intervention-Driven Move vs. Today’s Organic Approach to 155 July’s Intervention Today How USD/JPY reached this territory Record intervention, cost roughly $96.5bn, included rare US participation Approaching organically, no confirmed official Yen buying Key levels 155.22 (post-intervention low), 155.01 (support) Same levels now back within reach Attributed driver Direct official Yen buying BoJ tightening expectations and GPIF speculation Dollar Weakens Even as Oil Sends a Normally Bullish Signal Yen’s surge has become dominant force in FX, with Dollar lower against all major counterparts despite a backdrop that would normally be considerably more supportive. In Dollar index specifically, Yen’s sizeable weighting means its appreciation directly pulls index lower. More broadly, modest easing in Treasury yields has allowed Dollar weakness to spread across EUR, GBP and CHF as traders focus on Japanese policy repricing rather than extending this week’s US rates trade.

That creates today’s most counterintuitive cross-asset signal. Brent has broken above $97 to fresh six-week highs as US-Iran conflict intensifies, yet Dollar is falling. Earlier this week, higher oil transmitted relatively cleanly through inflation fears into higher Treasury yields and firmer expectations for Fed tightening. That channel has not disappeared, but it is being overshadowed in FX by Yen’s much larger independent move and the pause in US yields.

Wednesday’s softer ADP report, with private payrolls rising only 38K, contributed to that pause in further hawkish repricing, but it is not the principal driver of Thursday’s Dollar move. Initial jobless claims subsequently matched expectations at 206K, offering little additional direction. Markets still attach substantial probability to September Fed hike, leaving Friday’s NFP as decisive test. For now, more revealing question is not simply why Dollar is weaker, but why Brent above $97 has failed to make Dollar stronger. Answer lies in Japan: Yen and BoJ repricing have become larger currency-market forces today.

Oil Story Shifts From Escalation to Duration Brent meanwhile climbed to an intraday high around $97.62, extending this week’s rally and reaching its strongest level in six weeks. But narrative is beginning to shift. Earlier phases of renewed fighting were dominated by immediate questions over each US strike, Iranian retaliation and potential disruption to Strait of Hormuz. Markets are now considering a more difficult possibility: conflict and impaired regional energy flows could persist into 2027. Recent market commentary has explicitly moved toward that longer time horizon, with Capital Economics expecting restoration of Middle East energy flows to be delayed until early next year and forecasting Brent around $100 by end-2026.

That matters more for inflation than another isolated military exchange. A conflict measured in additional months rather than days would prolong pressure on shipping, inventories and refined-product markets, increasing chances that energy inflation becomes persistent enough to influence central-bank decisions. Iranian retaliation has also widened geographically, while US officials continue to signal that military pressure could intensify again even as Washington tries to limit escalation ahead of November elections. Reuters reported that administration officials see possibility of more intense attacks after midterms, underscoring absence of a clear near-term exit from a war now in its seventh month.

The closing contradiction is therefore striking. Brent above $97 and rising concern that US-Iran conflict could extend into 2027 would normally form a potent Dollar-supportive combination through inflation and rates. Instead, Dollar is broadly weaker because Japan has taken control of FX narrative. Oil is still setting global inflation risk, but today, Japan is setting currency direction.

Related Coverage Yen & Precious Metals Deep Dives Read why Silver’s rebound from 63.27 still depends on holding 62.54-62.92 to keep its five-wave recovery from 54.77 alive ahead of Friday’s NFP: Silver’s Correction Has Reached Its Line in the Sand — What Happens Next?. See why Friday’s NFP creates an asymmetric setup for USD/JPY, with weak data opening a clearer path toward 155 than strong data does above 160: USD/JPY Tumbles Under the Shadow of Intervention, Faces Asymmetric NFP Test. US Data Deep Dive Read why jobless claims matching expectations at 206K still leaves Friday’s NFP as the clearer labor-market signal: US Initial Jobless Claims Rise from 204K to 206K. Global Inflation Deep Dives See why Eurozone PPI’s swing to +1.6% m/m was driven largely by a 5.6% jump in energy prices, with annual producer inflation accelerating to 5.8%: Eurozone PPI Surges 1.6% M/M as Energy Drives Renewed Producer Inflation (full Eurostat release). Read why Swiss CPI’s jump to 0.8% was driven mostly by energy and imported prices, with core inflation holding at 0.4%: Swiss CPI Jumps to 0.8%, but Energy Drives Much of Inflation Surprise. Global PMI Round-Up See why UK services hitting a four-month high still came with employment falling for a 23rd straight month: UK PMI Services Hits Four-Month High as Cost Pressures Reaccelerate. Read why Eurozone’s composite PMI holding at an eight-month high alongside stalled disinflation is strengthening the case for ECB tightening: Eurozone PMI Composite Holds Firm as Sticky Prices Strengthen ECB Tightening Case. See why Japan’s record composite selling-price inflation is adding to the case for another BoJ hike even as growth accelerates: Japan PMI Growth Accelerates as Record Selling Prices Strengthen BoJ Hike Case. Read why Australian services confidence hit a six-month high even as fuel and wage costs kept input inflation elevated: Australia PMI Services Holds Firm at 53.2 as Confidence Rises but Costs Stay High. See why China’s services and composite PMI gains reflect stronger domestic demand and sustained hiring: China RatingDog PMIs Strengthen as Services and Employment Gain Momentum. Frequently Asked Questions Q: Why is Dollar falling even though oil just broke above $97? A: Because Yen’s much larger, independent move is overwhelming the usual oil-to-Dollar transmission channel. Higher oil normally supports Dollar through inflation fears feeding into higher Treasury yields and firmer Fed tightening expectations, and that channel hasn’t disappeared. But Yen’s sizeable weighting in the Dollar index, combined with a pause in US yields, means Japanese policy repricing is currently the bigger force in FX. The real question today isn’t why Dollar is weaker, it’s why Brent above $97 hasn’t made it stronger, and the answer is Japan.

Q: What is GPIF and why does speculation about it matter for Yen? A: GPIF is Japan’s roughly $2 trillion Government Pension Investment Fund. It held an unusual management committee meeting on August 21, its first August meeting since 2019, revisiting its basic portfolio just five months after concluding in March that no review was needed. Markets are watching whether GPIF could raise its 25% target allocation to domestic bonds. A larger domestic allocation would reinforce the repatriation trend already underway as Japanese investors reduce overseas bond exposure, adding further support to Yen and potentially easing some upward pressure on JGB yields.

Q: How is this approach to 155 different from July’s intervention? A: July’s move to the 155 area came from a record, roughly $96.5bn intervention that included rare US participation. This time, USD/JPY is approaching the same 155.22 and 155.01 levels organically, with no confirmed official Yen buying. Traders are attributing the move to BoJ tightening expectations and GPIF speculation rather than direct intervention, even though currency diplomat Mimura says authorities remain on “a state of heightened alert.”

Key Takeaways USD/JPY broke through 157.99 to around 156: Bringing the 155 area back into range for the first time since July’s intervention. GPIF speculation is adding fresh fuel to Yen’s rally: Markets are watching whether Japan’s roughly $2 trillion pension fund raises its 25% domestic bond allocation after an unusual August 21 committee meeting. Japan’s 10-year JGB yield briefly hit 3.015% this week: The highest since 1996, up roughly one percentage point since March. Currency diplomat Mimura kept intervention rhetoric alive: Saying he’s “neither satisfied nor reassured,” though traders still attribute Yen strength to BoJ tightening expectations, not intervention. Brent climbed to a six-week high around $97.62: As the oil narrative shifts from immediate escalation questions to concern the conflict could extend into 2027. Reuters reported officials see possible intensified attacks after the US midterms: Underscoring no clear near-term exit from a conflict now in its seventh month. Dollar is broadly weaker despite a combination that would normally support it: Brent above $97 and extended conflict risk usually mean higher inflation and rates support for Dollar, but Japan has taken control of the FX narrative instead. Unlike July, today’s approach to 155 is organic: No confirmed official Yen buying, unlike July’s roughly $96.5bn intervention with rare US participation. What to Watch Next Friday’s US nonfarm payrolls report is the decisive near-term test for Dollar, following a softer ADP print and in-line jobless claims. Watch whether USD/JPY breaks below 155, further signals on GPIF’s portfolio review, and whether Brent extends toward $100 as Capital Economics and others push their Middle East normalization timelines further into 2027.

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ActionForex.com was set up back in 2004 with the aim to provide insightful analysis to forex traders, serving the trading community for two decades. We started providing only a daily and a mid-day report, now known as Action Insights. Gradually, we added a lot more in-house contents to the site. Technical Outlook section was expanded to cover more pairs. In addition to that, Top Movers, Heat Map, Pivot Point Charts and Pivot Meters, Action Bias and Volatility Charts, are tools used by traders from all over the world.

USD/INR has broken below Goldman's 95-97 range as RBI-linked inflows lift the Rupee, although importer demand and expensive oil threaten the rally. The US Dollar to Indian Rupee (USD/INR) exchange rate has rebounded to around 94.54 after the Rupee briefly drove the pair down to 94.24.

That move carried USD/INR decisively below the 95–97 range expected by Goldman Sachs.

The Indian Rupee has strengthened by almost 1% over the past week, although the US Dollar to Rupee exchange rate remains more than 5% higher since the beginning of 2026.

Near-Term: Goldman Expects USD/INR to Stay Between 95 and 97 Goldman expects Asian currencies to make further progress against the Dollar, but it sees important differences within the region.

“Year-to-date Asian currency performance can be neatly explained by exposure to tech exports. The KRW, SGD, MYR, and TWD have outperformed the less tech-exposed, high-yielding currencies in Asia: INR, IDR, and PHP. Going forward, we expect USD/Asia to grind lower.”

The bank favours currencies with greater exposure to the technology cycle.

“Tech-related currencies such as KRW, TWD, and MYR should outperform others.”

Its Indian Rupee view is considerably more restrained.

“Among the high-yielding currencies, we expect USDINR to remain range-bound between 95 and 97 now that the catalyst for the rally, namely FCNR, is behind us.”

The subsequent decline to 94.24 challenges both the bottom of that range and the assumption that the relevant inflows had already run their course.

The latest Rupee strength has been supported by flows associated with the Reserve Bank of India's temporary measures for attracting foreign-currency funding.

According to the RBI's provisional figures, the facilities generated total inflows of $136.38 billion by 31 August.

Foreign Currency Non-Resident deposits accounted for $127.23 billion of that total.

The FCNR window closed at the end of August, supporting Goldman's argument that this particular source of demand should now fade.

Even so, the scale and timing of the inflows were sufficient to drive USD/INR below 95 before the market could fully absorb them.

The move also carried the pair close to the 94 level highlighted in an earlier Indian Rupee forecast.

USD/INR Outlook: Oil Prices and Importer Demand Could Restore the Range The Indian Rupee's break below 95 may prove difficult to sustain if oil prices remain around $95 a barrel.

India imports most of its crude requirements, so expensive energy increases demand for Dollars and worsens the country's external balance.

Importer buying has already emerged near the recent USD/INR lows, helping the pair recover from 94.24 to approximately 94.54.

A return above 95 would bring the market back inside Goldman's projected range without requiring a broader reversal in the Rupee's trend.

Continued trading below 95, particularly after the FCNR window has closed, would present a more serious challenge to the forecast.

Investors will now watch crude-oil prices, importer Dollar demand, RBI liquidity operations and any further foreign-currency inflows.

US yields, payroll figures and Federal Reserve expectations will determine whether the Dollar regains enough support to restore Goldman's 95–97 range.

The USD/JPY has dropped around 300 pips from its overnight highs in second day of sharp selling. Suspected BoJ intervention and, more likely, expectations of a hawkish BoJ hike have helped to lift the yen across the board.

Benchmark Payroll Data and Interest Rates That being said, the jobs report gives a little bit of further guidance because the expected addition of 55,000 jobs is a good benchmark to measure whether or not we are moving towards those rate cuts. If the jobs number comes out hotter than anticipated, it could work against gold as rates will probably continue to grind higher.

Ultimately, this is a nice settling spot between now and that jobs report, so it’s not overly surprising to see gold just kind of bounce around in this area, initially bouncing off of the 200-day EMA early Wednesday, only to test the $4,500 level.

I expect probably a little bit of chop here. Again, it makes sense with that important jobs number the next day. Keep in mind that it is a long weekend in the United States as well, so Monday will be Labor Day. That could affect some liquidity.

Key takeaways JPY strength accelerates: USD/JPY fell 0.91% on 2 September and extended its decline by another 1.35% on 3 September, a move comparable with the sharp decline seen around the July US-Japan FX intervention. Fundamentals are turning more yen-supportive: US Treasury Secretary Scott Bessent’s support for decisive Japanese action, BoJ policymaker Hajime Takata’s discussion of larger or consecutive rate hikes, and renewed intervention risk have strengthened the bullish JPY narrative. 200-day MA breakdown damages USD/JPY’s uptrend: The pair has broken below its 200-day MA and erased its gains since the 3 August low. Unless 158.04/50 is reclaimed, downside risk remains towards 155.03 and 153.84. In the past 40 hours, the Japanese yen has strengthened dramatically against the US dollar, a trend that began on Wednesday, 2 September 2026, when USD/JPY declined by 0.91%.

In follow-through today (Wednesday, 3 September 2026), USD/JPY has extended its losses by a further 1.35% at the time of writing (see Fig. 1).

The current decline of the USD/JPY is almost on par with the daily loss of 1.32% recorded on 31 July 2026, where Japan and the US confirmed their first joint FX intervention in around 28 years following the Japanese government’s sole intervention a day earlier on 30 July 2026, in bid to stall the steep pace of JPY weakening where USD/JPY soared to the 164 handle on 23 July 2026, its highest level in about 40 years.

Fig. 1: Daily rate of change (%) of USD/JPY with key events as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance.

Today’s swift decline in USD/JPY smells like FX intervention, with no clear catalyst in relevant economic data releases.

However, so far, there are no official press releases from Japan or the US confirming any form of intervention, and no “according to sources” reporting from media outlets.

What we know so far… Here are the three fundamental developments to reinforce the current bout of JPY strength:

US Treasury Secretary Scott Bessent expressed support for decisive Japanese action to address yen weakness to Bank of Japan (BoJ) Governor Ueda during the G-20 finance and central bank leaders meeting last weekend, according to a readout released by the US Treasury Department on Tuesday, 1 September 2026. This reduces the political constraint on further BoJ tightening and suggests Washington is increasingly comfortable with a stronger yen. BOJ board member Hajime Takata said policymakers should consider options beyond the conventional 25-basis-point rate increase, including larger or consecutive hikes, said in a news conference on Wednesday, 2 September 2026. While Takata remains one of the BoJ’s most hawkish members, his comments increase the risk that the central bank accelerates its tightening cycle. The speed of the yen’s appreciation placed traders on high alert for another round of intervention. Although there was no immediate confirmation of official yen buying, the threat of action creates an increasingly asymmetric risk around the psychologically important 160.00 region. Let’s now unpack the short-term trajectory (1 to 3 days) of the USD/JPY from a technical analysis perspective.

Major uptrend phase of USD/JPY has been damaged, bounce before a new drop Fig. 2: USD/JPY medium-term trend as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance.

Fig. 3: USD/JPY minor trend as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance.

Today’s swift bearish reaction in USD/JPY comes right after the retest of a key pullback resistance level at around 160.30, a former major ascending trendline support from the 22 April 2025 low (see Fig. 2).

Today’s decline in USD/JPY has sent it below the key 200-day moving average and erased all its gains from the prior one month, since the 3 August 2026 low of 155.23 (see Fig. 2).

The current steep intraday decline in USD/JPY has pushed the hourly RSI momentum indicator into oversold territory, but there is no clear bullish divergence at this juncture (see Fig. 3).

Hence, USD/JPY may now form a potential minor dead cat bounce at the near-term support of 156.32, towards the near-term resistance of 157.30.

Watch the 158.04/50 key short-term pivotal resistance (also the 200-day moving average). If this zone is not surpassed to the upside, the odds are skewed towards a new potential bearish impulsive down-move sequence next, which could expose the next intermediate supports at 155.03 and 153.84 in the first step (see Fig. 3).

On the other hand, a clearance and an hourly close above 158.50 would invalidate the bearish scenario, triggering a squeeze up to retest the next intermediate resistance at 159.18/54 (20-day moving average) (see Fig. 3).

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GBP/USD at two-week low: Risk aversion takes holdGBP/USD attempted to rebound from a two-week low of approximately 1.3485 on Thursday. Investors are moving away from riskier assets amid concerns about the economic impact of an energy shock triggered by a fresh escalation in the Middle East.

The market is digesting Prime Minister Andy Burnham’s address to the House of Commons. He reaffirmed the government’s commitment to fiscal discipline and reducing the debt burden. The Prime Minister also noted that bringing forward the budget submission date should help reduce speculation about future fiscal measures. Chancellor John Healy’s first major statement on the government’s programme is expected as early as next week. Read more...

British Pound gains capped as fiscal, geopolitical risks persistGBP/USD gains after two days of losses, trading around 1.3500 during the European hours on Thursday. The currency pair experiences an upward push as a sharp rally in the Japanese Yen (JPY) weighed heavily on the US Dollar (USD). This sudden Yen surge was largely driven by market speculation that Japanese authorities conducted a rate check, signaling potential direct intervention in foreign exchange markets.

Adding to the Greenback's troubles, recent economic data highlighted a slowdown in US private-sector employment for August, where ADP figures showed only 38,000 positions added against an expected 47,000. Despite these cooling labor signals, financial markets are still pricing in roughly a two-thirds probability of a Federal Reserve interest rate hike later this month, leaving traders eagerly awaiting upcoming jobless claims and Friday’s comprehensive payrolls report for clearer policy direction. Read more...

GBP/USD Price Forecast: Holds a mildly bullish bias near 1.3500 despite subdued RSI momentumThe GBP/USD pair trades in positive territory around 1.3490 during the early European trading hours on Thursday, bolstered by a weaker US Dollar (USD). Traders await the Bank of England (BoE) Governor Andrew Bailey’s speech and US August jobs data later on Friday for fresh impetus. 

Federal Reserve (Fed) Chair Kevin Warsh delivered unexpectedly hawkish remarks at the Jackson Hole meeting last week, boosting market expectations for a rate hike next month. Warsh pledged to return inflation to the 2% target and indicated rates could rise further. Read more...

Referenced assets

Key takeaways JPY strength accelerates: USD/JPY fell 0.91% on 2 September and extended its decline by another 1.35% on 3 September, a move comparable with the sharp decline seen around the July US-Japan FX intervention.Fundamentals are turning more yen-supportive: US Treasury Secretary Scott Bessent’s support for decisive Japanese action, BoJ policymaker Hajime Takata’s discussion of larger or consecutive rate hikes, and renewed intervention risk have strengthened the bullish JPY narrative.200-day MA breakdown damages USD/JPY’s uptrend: The pair has broken below its 200-day MA and erased its gains since the 3 August low. Unless 158.04/50 is reclaimed, downside risk remains towards 155.03 and 153.84. In the past 40 hours, the Japanese yen has strengthened dramatically against the US dollar, a trend that began on Wednesday, 2 September 2026, when USD/JPY declined by 0.91%.

In follow-through today (Wednesday, 3 September 2026), USD/JPY has extended its losses by a further 1.35% at the time of writing (see Fig. 1).

The current decline of the USD/JPY is almost on par with the daily loss of 1.32% recorded on 31 July 2026, where Japan and the US confirmed their first joint FX intervention in around 28 years following the Japanese government’s sole intervention a day earlier on 30 July 2026, in bid to stall the steep pace of JPY weakening where USD/JPY soared to the 164 handle on 23 July 2026, its highest level in about 40 years.

Fig. 1: Daily rate of change (%) of USD/JPY with key events as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance. Today’s swift decline in USD/JPY smells like FX intervention, with no clear catalyst in relevant economic data releases.

However, so far, there are no official press releases from Japan or the US confirming any form of intervention, and no “according to sources” reporting from media outlets.

What we know so far… Here are the three fundamental developments to reinforce the current bout of JPY strength:

US Treasury Secretary Scott Bessent expressed support for decisive Japanese action to address yen weakness to Bank of Japan (BoJ) Governor Ueda during the G-20 finance and central bank leaders meeting last weekend, according to a readout released by the US Treasury Department on Tuesday, 1 September 2026. This reduces the political constraint on further BoJ tightening and suggests Washington is increasingly comfortable with a stronger yen.BOJ board member Hajime Takata said policymakers should consider options beyond the conventional 25-basis-point rate increase, including larger or consecutive hikes, said in a news conference on Wednesday, 2 September 2026. While Takata remains one of the BoJ’s most hawkish members, his comments increase the risk that the central bank accelerates its tightening cycle.The speed of the yen’s appreciation placed traders on high alert for another round of intervention. Although there was no immediate confirmation of official yen buying, the threat of action creates an increasingly asymmetric risk around the psychologically important 160.00 region.Let’s now unpack the short-term trajectory (1 to 3 days) of the USD/JPY from a technical analysis perspective.

Major uptrend phase of USD/JPY has been damaged, bounce before a new drop Fig. 2: USD/JPY medium-term trend as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance. Fig. 3: USD/JPY minor trend as of 3 Sep 2026 (Source: TradingView). The information presented is historical information, and past performance is not indicative of future performance. Today’s swift bearish reaction in USD/JPY comes right after the retest of a key pullback resistance level at around 160.30, a former major ascending trendline support from the 22 April 2025 low (see Fig. 2).

Today’s decline in USD/JPY has sent it below the key 200-day moving average and erased all its gains from the prior one month, since the 3 August 2026 low of 155.23 (see Fig. 2).

The current steep intraday decline in USD/JPY has pushed the hourly RSI momentum indicator into oversold territory, but there is no clear bullish divergence at this juncture (see Fig. 3).

Hence, USD/JPY may now form a potential minor dead cat bounce at the near-term support of 156.32, towards the near-term resistance of 157.30.

Watch the 158.04/50 key short-term pivotal resistance (also the 200-day moving average). If this zone is not surpassed to the upside, the odds are skewed towards a new potential bearish impulsive down-move sequence next, which could expose the next intermediate supports at 155.03 and 153.84 in the first step (see Fig. 3).

On the other hand, a clearance and an hourly close above 158.50 would invalidate the bearish scenario, triggering a squeeze up to retest the next intermediate resistance at 159.18/54 (20-day moving average) (see Fig. 3).

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About the Author

Kelvin Wong Senior Market Analyst

Based in Singapore, Kelvin Wong is a well-established senior global macro strategist with over 15 years of experience trading and providing market research on foreign exchange, stock markets, and commodities.

Passionate about connecting the dots in the financial markets and sharing perspectives around trading and investment, Kelvin Wong is an expert in using a unique combination of fundamental and technical analyses, specializing in Elliott Wave and fund flow positioning, to pinpoint key reversal levels in the financial markets.

In addition, over the last ten years, Kelvin has conducted numerous market outlook and trading-related seminars, as well as technical analysis training courses, for thousands of retail traders.

Based in Singapore, Kelvin Wong is a well-established senior global macro strategist with over 15 years of experience trading and providing market research on foreign exchange, stock markets, and commodities.

Passionate about connecting the dots in the financial markets and sharing perspectives around trading and investment, Kelvin Wong is an expert in using a unique combination of fundamental and technical analyses, specializing in Elliott Wave and fund flow positioning, to pinpoint key reversal levels in the financial markets.

In addition, over the last ten years, Kelvin has conducted numerous market outlook and trading-related seminars, as well as technical analysis training courses, for thousands of retail traders.