On Friday, theNigerian naira (NGN) was the best-performing currency among the 20 global currencies we track, while the Russian ruble (RUB) showed the weakest results. The euro (EUR) was the leader among majors, while the Japanese yen (JPY) underperformed.
Gold Moves Higher as Political and Financial Instability is Growing
The gold price rose by almost 0.70% on Friday as disappointing macroeconomic data and social instability in the U.S. brought the dollar down and pushed metals higher.
Gold and silver are rallying on a wall of worry,' said Tai Wong, a New York-based independent metals trader. On Friday, the U.S. United Auto Workers (UAW) union started a strike at three factories in Detroit, being the largest industrial labor action in decades. In addition, the media write about the possible government shutdown at the end of the month, fuelling political concerns. Moreover, the Consumer Confidence Index published by the University of Michigan came out lower than expected, boosting hopes that the Federal Reserve (Fed) won't raise the benchmark interest rate this year. The market is currently pricing in only a 27% chance of a rate hike in November and less than a 40% probability of a rate increase in December.
XAU/USD was rising during the Asian session. Today's economic calendar is relatively light, so gold probably won't fluctuate much. However, traders may change their positions ahead of this week's central banks' decisions. Therefore, XAU/USD may possibly be correct towards 1,916. 'Spot gold may test a resistance zone of 1,933–1,935 USD per ounce, a break above which could lead to a gain into the 1,941–1,943 range,' said Reuters analyst Wang Tao.
Strong Australian Economic Reports Failed to Boost AUD/USD
The Australian dollar (AUD) rose on Friday but failed to hold above the important 0.64700 level and dropped sharply, losing around 0.11% over a day.
The recent Australian macroeconomic data has been coming out better than expected. For example, the Gross Domestic Product in Q2 expanded faster than anticipated. Also, employment and labor participation rates exceeded analysts' expectations last week. However, AUD/USD surprisingly continues to move below 0.65500 and struggles to rise above 0.64500. The Reserve Bank of Australia (RBA) kept the base rate unchanged at the previous meeting but warned that further tightening might be needed to bring inflation down.
AUD/USD was rising slightly in the Asian session. Traders now await the publication of the RBA minutes from the previous meeting on 19 September at 1:30 a.m. UTC. 'The minutes will suggest that the country's economy is on track for a "soft landing", but could also repeat concerns about sticky services inflation,' ANZ analysts wrote in a note. If the RBA sounds hawkish, AUD/USD may finally break 0.64700 and target the key 0.65000 area.