Forex Today: Fed Cut on the Table as Dollar Dips, UK GDP Takes Center Stage

Source: Fxstreet

11 Sept 2025 19:30

The case for the Federal Reserve's first rate cut since December 2024 looks increasingly solid after both producer and consumer inflation data came in soft. The US Dollar has resumed its downward slide as markets digest the final pieces of economic data before Friday's University of Michigan Consumer Sentiment Index release.

Friday's key watchpoints (September 12):

The Dollar Index (DXY) is down 0.26% to 97.54. Though some technical indicators suggest the greenback may have found a bottom, continued weakness in the labor market - confirmed by the latest Initial Jobless Claims - adds to the bearish pressure ahead of next week's Fed meeting.

EUR/USD has regained some momentum after the ECB maintained rates and Christine Lagarde declared the "disinflationary process is over." The pair pushed back above 1.1700 as the Dollar weakened. Markets expect the ECB to hold rates steady for the remainder of the year.

GBP/USD broke past 1.3500 and seems ready to test 1.3600 as traders await UK GDP data on Friday. Economists expect monthly figures to come in flat (0%), with yearly growth projected at 1.1%, up significantly from June's 0.2%.

USD/JPY turned negative as disappointing US data hammered the Dollar, with the 147.00 level now in sight. Japan releases Industrial Production and Capacity Utilization figures for July today, which could provide insights into manufacturing strength amid ongoing political turmoil following PM Ishiba's resignation.

AUD/USD surged to fresh yearly highs of 0.6664 and looks poised to test 0.6700 soon. With no economic data from Australia or China today, market sentiment will likely drive Aussie movements.

Gold prices are struggling to find direction despite Dollar weakness. XAU/USD remains trapped in the $3,630-$3,650 range as traders fully process the latest US economic figures.

US Dollar Performance This Week

The table shows percentage changes of USD against major currencies this week. The Dollar performed worst against the Australian Dollar, dropping 1.64%, while gaining slightly (0.05%) against the Canadian Dollar.

[Table data showing currency performance matrix]

The heat map displays percentage changes between major currencies. To read it, select a base currency from the left column and find its performance against a quote currency from the top row.

Disclaimer: For information purposes only. Past performance doesn't predict future results.

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