The US dollar index (DXY) fell to a two-week low near the 98.00 price zone on Friday, extending losses recorded the previous day and ending a week in which the world’s major central banks confirmed a hawkish shift amid mounting inflation pressures. Next week, investors’ attention will continue to be focused on any developments related to potential negotiations between the US and Iran, as well as a series of US employment data, culminating in non-farm payrolls data.
The economic calendar was lithe on Friday as many markets around the world were closed for Labor Day. Still, in the US, the ISM Manufacturing Managers Index (PMI) was 52.7, below the expected 53.
In the Middle East, the Islamic Republic of Iran presented its latest negotiation proposal to Pakistan, acting as a mediator in talks with the United States. It was not immediately clear what the modern proposal contained, but Trump said he could not agree to Tehran’s current demands: “Iran wants to make a deal, but I’m not satisfied,” he said.
Earlier in the day, Iranian Foreign Minister Abbas Araghchi discussed the Islamic Republic’s latest initiatives to end the war with counterparts in Saudi Arabia, Qatar, Turkey, Iraq and Azerbaijan, according to a ministry statement.
Today’s US dollar price
The table below shows the current percentage change of the United States Dollar (USD) against the major listed currencies. The US dollar was strongest against the Japanese yen.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.20% | -0.12% | 0.09% | -0.03% | -0.25% | -0.15% | -0.27% | |
| EUR | 0.20% | 0.07% | 0.28% | 0.15% | -0.04% | 0.03% | -0.07% | |
| GBP | 0.12% | -0.07% | 0.21% | 0.09% | -0.12% | -0.04% | -0.12% | |
| JPY | -0.09% | -0.28% | -0.21% | -0.12% | -0.34% | -0.28% | -0.36% | |
| BOOR | 0.03% | -0.15% | -0.09% | 0.12% | -0.23% | -0.14% | -0.22% | |
| AUD | 0.25% | 0.04% | 0.12% | 0.34% | 0.23% | 0.08% | 0.00% | |
| NZD | 0.15% | -0.03% | 0.04% | 0.28% | 0.14% | -0.08% | -0.09% | |
| CHF | 0.27% | 0.07% | 0.12% | 0.36% | 0.22% | 0.00% | 0.09% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select 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).
EUR/USD rose to a near two-week high near 1.1780. The pair maintains growth for the second day in a row after the European Central Bank (ECB) left interest rates unchanged at its meeting on Thursday. US President Donald Trump announced on Friday that tariffs on cars and trucks in the European Union would rise to 25% from the current 15%, reigniting fears of a trade war.
GBP/USD rose to the 1.3630 price area. The rise comes as investors are moving away from the US dollar (USD) amid improved risk sentiment after Iran proposed contact with the US via Pakistan, with the aim of finalizing a peace deal once and for all.
USD/JPY stabilized after falling from 160.00 to 156.60 following the intervention of the Japanese government on Thursday. Data released on Friday showed Tokyo’s consumer price index (CPI) for April excluding fresh food was 1.9%, down from 2.3% last month. The main measure was published at 1.5%, up slightly from 1.4% last month.
AUD/USD has risen towards the 0.7220 price zone as investors take a wait-and-see approach ahead of the Reserve Bank of Australia’s (RBA) monetary policy decision scheduled for next Tuesday. Earlier in the day, the Producer Price Index (PPI) was 3%, down from 3.5% the previous month.
Gold prices are essentially unchanged at $4,630 as investors focus on riskier positions at the end of the week.
WTI West Texas Intermediate (WTI) fell to close to $98.50 per barrel as a result of the peace agreement reached by Iran under the influence of Pakistan by the US.
Anticipating the economic outlook: voices on the horizon
Monday, May 4:
- Eurogroup meeting
- ECB Cipollone speaks
- Fed Williams speaks
- ECB Nagel speaks
Tuesday, May 5:
- RBA press conference
- ECB De Guindos speaks
- This is what ECB President Lagarde says
- Fed Bowman speaks
- ECB Lane speaks
- Fed Barr speaks
Wednesday, May 6:
- ECB Lane speaks
- ECB Cipollone speaks
- Fed Musalem speaks
- Fed Goolsbee speaks
- Fed Hammack Speaks
Thursday, May 7:
- ECB De Guindos speaks
- ECB Elderson speaks
- ECB Lane speaks
- ECB Schnabel speaks
- Fed Hammack Speaks
- Fed Williams speaks
Friday, May 8:
- This is what ECB President Lagarde says
- ECB De Guindos speaks
- Fed Cook speaks
- ECB Cipollone speaks
- ECB Schnabel speaks
- ECB Nagel speaks
- Fed Bowman speaks
- Fed Goolsbee speaks
- Fed Waller Speaks
Central bank meetings and upcoming data releases will shape markets
Monday, May 4:
- Australian TD-MI inflation index April y/y
- Australian building permits in March this year
- Germany, France, Italy, euro zone HCOB Manufacturing PMI April
- Confidence of Sentix investors from the euro zone in May
- US factory orders in March m/m
- Australian S&P PMI indices in April
Tuesday, May 5:
- Australian RBA interest rate decision
- Australian RBA Monetary Policy Statement
- Australian RBA interest rate statement
- China consumer price index April m/m/y
- American S&P PMIS index in April
- American ISM PMI services
- JOLTS job offers in the USA in March
- New home sales in the US in February and March m/m
- New Zealand employment data
Wednesday, May 6:
- China Caixin Services PMI for April
- Germany, France, Italy, euro zone HCOB Services PMI April
- Producer price index in the euro area March m/m/y/y
- Employment change at ADP in the USA in April
- Canadian Ivey PMI in April
- Cash income of the Japanese labor force in March y/y
- Minutes of the Japanese BoJ monetary policy meeting
Thursday, May 7:
- Australian trade balance
- Factory orders in Germany in March m/m/y
- Retail sales in the euro zone March m/m/y/y
- American Challenger reduces employment in April
- Initial applications for unemployment benefits in the USA
- Performance of the US non-farm sector Q1 Prel
- Unit labor costs in the USA Q1 Prel
Friday, May 8:
- Germany Industrial production March m/m/y/y
- Euro zone trade balance in March
- Canada employment data
- American NFP report
Frequently asked questions about WTI crude oil
WTI Oil is a type of crude oil sold on international markets. WTI stands for West Texas Intermediate, one of three main types, including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” due to its relatively low weight and low sulfur content. It is considered a high-quality oil that can be easily refined. It originates in the United States and is distributed through the Cushing Junction, considered the “Crossroads of the World.” It is a reference point for the crude oil market, and the WTI price is often quoted in the media.
Like all assets, supply and demand are key factors influencing the price of WTI crude oil. Therefore, global growth may drive increased demand and, conversely, feeble global growth. Political instability, wars and sanctions can disrupt supply and affect prices. Another key factor shaping prices are the decisions of OPEC, the group of major oil-producing countries. The value of the US dollar affects the price of WTI crude oil because oil is mainly sold in US dollars, so a weaker US dollar can make oil more affordable and vice versa.
Weekly crude oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Administration (EIA) influence the price of WTI crude oil. Inventory changes reflect fluctuations in supply and demand. If the data shows a decline in inventories, it may indicate increased demand, which will result in an raise in the price of oil. Higher inventories may reflect increased supply, which causes prices to fall. The API report is published every Tuesday and the EIA report the next day. Their results are usually similar and are within 1% of each other 75% of the time. EIA data is considered more reliable because it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 oil-producing countries that jointly decide on production quotas for member countries at meetings held twice a year. Their decisions often influence the prices of WTI crude oil. When OPEC decides to cut quotas, it can tighten supply, which will push up oil prices. OPEC increasing production has the opposite effect. OPEC+ refers to an expanded group that includes ten additional non-OPEC members, the most notable of which is Russia.
