Forex Today: Markets keep watch on US data and geopolitics

The US Dollar (USD) remained rangebound. Efforts to reverse the weekly correction struggled to gain traction as market participants weighed geopolitical developments during a quiet period ahead of the Fed.

101.80-101.60 defined the narrow trading band for the US Dollar Index (DXY), with gains and losses alternating. The weekly Initial Jobless Claims report and the CB Leading Index are due for release.

With direction lacking across the FX market, EUR/USD edged lower towards the 1.1200 support zone. Attention on the domestic calendar now turns to the euro area’s flash Consumer Confidence reading and a speech by the ECB’s Panetta.

A brief move above the 1.3400 barrier left GBP/USD modestly higher on the day, extending Tuesday’s gains. The UK calendar features the forthcoming CBI Business Optimism Index and CBI Industrial Trends Orders releases.

Below 158.00 again, USD/JPY extended the previous day’s decline as further selling pressure emerged. Japan is due to publish its weekly Foreign Bond Investment figures.

A fourth consecutive daily advance took AUD/USD further above the 0.7000 level following its recent breakout. Australia’s next scheduled releases are the preliminary S&P Global Manufacturing and Services PMIs on 23 October.

Near $96.00 per barrel, front-month WTI futures faced renewed selling pressure as hopes persisted for a diplomatic resolution to the US-Iran confrontation.

The $4,150 per troy ounce level came under renewed test as gold regained its footing and posted reasonable gains. The rebound followed a marginal decline in the US Dollar, while US Treasury yields were mixed across the curve.