The US dollar softened against most major currencies on Friday, September 22, 2023, as traders took profits ahead of a number of key economic data releases next week, including the US Consumer Price Index (CPI) and the Federal Open Market Committee (FOMC) meeting.
The Japanese yen was the biggest beneficiary of the dollar’s weakness, rising 0.26% against the greenback to 143.50 yen per dollar. The yen has been supported in recent weeks by expectations that the Bank of Japan (BOJ) will intervene to prop up the currency if it falls too sharply.
Other major currencies that gained against the dollar on Friday included the euro (up 0.25% to 1.0040 USD/EUR), the British pound (up 0.69% to 1.1660 USD/GBP), and the Australian dollar (up 0.41% to 0.6730 USD/AUD).
The Canadian dollar was the only major currency to lose ground against the US dollar on Friday, falling 0.18% to 1.3230 USD/CAD. The Canadian dollar was weighed down by weaker-than-expected oil prices and downbeat economic data.
Overall, forex markets were relatively quiet on Friday, with traders awaiting next week’s key economic data releases. The US CPI report is expected to show that inflation remains high, which could support the dollar. However, a dovish stance from the FOMC could weigh on the greenback.
Here is a summary of the major forex moves on Friday, September 22, 2023:
- EUR/USD: +0.25%
- GBP/USD: +0.69%
- USD/JPY: -0.26%
- AUD/USD: +0.41%
- USD/CAD: -0.18%
Factors that influenced forex moves today
A number of factors influenced forex moves on Friday, September 22, 2023, including:
- Profit-taking ahead of key economic data releases: Traders took profits on their dollar positions ahead of a number of key economic data releases next week, including the US CPI report and the FOMC meeting.
- Expectations of BOJ intervention: The Japanese yen was supported by expectations that the BOJ will intervene to prop up the currency if it falls too sharply.
- Weaker oil prices and downbeat economic data: The Canadian dollar was weighed down by weaker-than-expected oil prices and downbeat economic data.
Outlook for forex markets next week
Forex markets are expected to be volatile next week as traders react to a number of key economic data releases, including the US CPI report and the FOMC meeting. The US CPI report is expected to show that inflation remains high, which could support the dollar. However, a dovish stance from the FOMC could weigh on the greenback.
In addition to the US economic data releases, traders will also be paying attention to central bank meetings in Japan and the UK next week. The BOJ is expected to keep its monetary policy unchanged, while the Bank of England (BOE) is widely expected to raise interest rates by 50 basis points.
Overall, forex markets are expected to be volatile next week as traders react to a number of key economic data releases and central bank meetings.