EUR/USD

The EUR/USD pair shows mixed dynamics, located near 1.1033 and local lows from September 12, updated the day before. Investor activity remains low at the end of the week in anticipation of the publication of the September report on the US labor market, which could have a key impact on financial authorities when making decisions in the area of monetary policy. The probability that the Fed will adjust the interest rate by only –25 basis points in November after –50 basis points in September is now 65.0%. Previously, analysts expected a more rapid decline in the rate, but after the speech of the Chair of the US Federal Reserve, Jerome Powell, at the beginning of the week, they changed their forecasts. The official spoke out against the accelerated easing of monetary parameters, which, in his opinion, could create additional risks for the economy. Preliminary estimates for the labor market report suggest a slight slowdown in Nonfarm Payrolls in September from 142.0 thousand to 140.0 thousand, while Average Hourly Earnings could decline from 0.4% to 0.3% month-on-month and remain at 3.8% year-on-year. The data published in the US yesterday turned out to be mixed: the dollar's position was supported by statistics on the Services PMI from the Institute for Supply Management (ISM), which rose in September from 51.5 points to 54.9 points, while experts expected 51.7 points. At the same time, Initial Jobless Claims for the week ending September 27 rose from 219.0 thousand to 225.0 thousand, ahead of expectations of 220.0 thousand, and Industrial Orders in August fell 0.2% after increasing by 4.9%. European business activity data also came in better than expected, with the S&P Global eurozone Services PMI rising from 50.5 points to 51.4 points in September, and the Composite PMI rising from 48.9 points to 49.6 points.

GBP/USD

The GBP/USD pair is trading with near-zero dynamics, holding near 1.3130. Investors will focus on the publication of the September report on the US labor market today, which, as analysts hope, will not lead to a revision of forecasts regarding further easing of the US Federal Reserve's monetary policy. Average Hourly Earnings are projected to slow down slightly month-on-month from 0.4% to 0.3% and remain unchanged year-on-year at 3.8%, while Nonfarm Payrolls are forecast to decline from 142.0 thousand to 140.0 thousand and the Unemployment Rate is expected to hold at 4.2%. At the same time, the probability that the regulator will decide to adjust the interest rate in November by only –25 basis points after –50 basis points in September is now 65.0%, according to the Chicago Mercantile Exchange (CME) FedWatch Tool. Today at 10:30 (GMT 2) British investors turned their attention to the Construction PMI, which, contrary to forecasts of a decline from 53.6 points to 53.1 points, rose to 57.2 points. Also, at 14:55 (GMT 2), there will be a speech by Bank of England representative Huw Pill. In addition, markets are assessing the business activity data published the day before: the S&P Global Services PMI fell from 52.8 points to 52.4 points in September with neutral forecasts, and the Composite PMI fell from 52.9 points to 52.6 points. The decline in business activity puts pressure on financial authorities to further ease monetary parameters, even as inflation risks show a steady weakening.

AUD/USD

The AUD/USD pair is showing minor gains, recovering from last Tuesday's sharp decline. The instrument is testing 0.6845 for a breakout, retreating from the local lows of September 26. Market activity remains subdued ahead of the release of September US labor market statistics. Analysts do not expect any significant changes in the indicators, so forecasts for further easing of the US Federal Reserve monetary policy until the end of the year are likely to remain. Nonfarm Payrolls may decrease from 142.0 thousand to 140.0 thousand, the Average Hourly Earnings may decrease to 0.3% from 0.4% in monthly terms and remain at 3.8% in annual terms, and the Unemployment Rate is expected to remain unchanged at 4.2%. Meanwhile, more active corrective growth of the instrument is being hampered by macroeconomic data from Australia: Home Loans in August slowed down from 2.5% to 0.7%, and Investment Lending for Homes — from 5.1% to 1.4%. The day before, investors also paid attention to statistics on the dynamics of foreign trade: Exports in August fell by 0.2% after 0.3% a month earlier, and Imports — by 0.2% after –0.6%. Against this backdrop, the trade surplus increased slightly from 5.636 billion Australian dollars to 5.644 billion Australian dollars. Additional pressure on the instrument was exerted by weak data on business activity: the Services PMI fell from 52.5 points to 50.5 points, and the Composite PMI fell from 51.7 points to 49.6 points, ending up in the stagnation zone.

USD/JPY

The USD/JPY pair is showing a fairly active decline, retreating from the local highs of August 20, updated the day before. The instrument is testing 146.00 for a breakdown, while investors are preparing for the publication of September statistics on the US labor market. Analysts do not expect significant changes in the dynamics of the indicators, so a noticeable reaction of the instrument to the data is not expected. Nonfarm Payrolls are likely to fall from 142.0 thousand to 140.0 thousand, Average Hourly Earnings are expected to remain unchanged at 3.8% year-on-year and could rise to 0.3% month-on-month from 0.4%, while the Unemployment Rate is expected to remain steady at 4.2%. The data may not impact expectations for further cuts in borrowing costs by the US Federal Reserve. At the beginning of the week, the Chair of the regulator, Jerome Powell, spoke out against a sharp easing of monetary policy, which immediately led to a revision of forecasts for a reduction in the rate by 50 basis points in November from 56.0% to 30.0%. Meanwhile, the statistics on jobless claims put some pressure on the position of the American currency the day before: Initial Jobless Claims from citizens for the week ended September 27 increased from 219.0 thousand to 225.0 thousand with preliminary estimates of 220.0 thousand, but the number of Continuing Jobless Claims (for the week ended September 20) fell from 1.827 million to 1.826 million. The yen, in turn, reacted negatively to the publication of business activity data: the Jibun Bank Manufacturing PMI from S&P Global fell from 53.9 points to 53.1 points in September.

XAU/USD

The XAU/USD pair is showing growth again during the morning session, recovering from uncertain dynamics. The instrument is again testing 2667.00 for a breakout, approaching the record highs updated last week. Expectations of further easing of monetary policy by the US Federal Reserve and a number of other global regulators are supporting quotes. At the beginning of the week, the Chair of the US Fed, Jerome Powell, spoke out against adjusting the cost of borrowing by –50 basis points, but in fact confirmed his readiness to reduce the rate in November and December by 25 basis points. Following the US Federal Reserve, the European Central Bank (ECB) and the Bank of England may soon announce a revision of monetary policy. Today, investors are awaiting the publication of a report on the US labor market, which may clarify the prospects for easing monetary parameters by the end of this year. At the same time, analysts' forecasts currently do not suggest significant fluctuations: the Nonfarm Payrolls in September may decrease from 142.0 thousand to 140.0 thousand, Average Hourly Earnings are expected to remain unchanged at 3.8%, and the Unemployment Rate — at 4.2%. In addition, markets continue to monitor the development of the conflict in the Middle East: the situation began to deteriorate after Iran’s retaliatory attack on Israel’s elimination of the Secretary General of the Islamist armed organization Hezbollah, Hassan Nasrallah, and the movement’s supreme command.