On September 8, Mario Centeno, a member of the European Central Bank's Governing Council, said the central bank must be cautious in subsequent meetings after a sharp interest rate hike underlined its determination to curb high inflation. The ECB raised interest rates by 75 basis points in a historic move to catch up with the Fed in terms of the strength of its policy to curb price spikes. ECB officials said they expect to raise borrowing costs further in the next few meetings, but the exact magnitude was not specified. Despite his usual cautious stance, he declared that the ECB's rare move to raise interest rates in a big step "sends the right signal", demonstrating to the government and workers the central bank's determination to fight inflation.

The EUR is still dominated by the USD. As the Fed's policy meeting is approaching, the market will eventually focus on it as a priority, which may be bearish on the USD. Also, it means a possibility of a short-term retracement in the EUR. But in the long run, issues such as policy gaps, energy crises, and recessions will always plague the EUR.

The USD is still on the rise overall, and the current retracement is just based on the market's correction of overheating expectations. However, the September policy meeting may weaken the USD in the near term. But if the Fed still sends a tough signal to show its determination to fight inflation, it may increase market expectations for the follow-up policy path and terminal interest rates again, which will also maintain the appreciation of the USD.

The USDCAD gained strong follow-through traction and pushed the pair to a near 2-year high. The fundamental technical backdrop supports a further bullish outlook. However, the possibility of sudden profit-taking by bulls cannot be ruled out.

Subject to the Fed's expectations of a significant rate hike, gold prices face the risk of further decline, technically the selling pressure is also obvious. After the fall below 1680, it may open a new round of medium-term decline.

Copper and other basic metals, as economic barometers, are sending warning signals about the global economy. The Bloomberg Industrial Metals Spot Subindex is losing out to the Bloomberg Commodity Spot Index as the Federal Reserve tightens its policy. The commodity report from industry research said that this unusual distortion could reflect the growing risk of a global recession as soaring food and energy prices prompted central banks to raise interest rates further. Copper prices in New York have fallen for five consecutive months, the longest monthly decline since 2008.