The British Pound (GBP) staged a notable rebound against the US Dollar (USD) on Thursday, reversing earlier losses and trading around 1.3540 at the time of writing, after touching intraday lows near 1.3493. Market participants digested a mixed US inflation report, which, despite marginally exceeding forecasts, failed to undermine expectations of a Federal Reserve (Fed) interest rate cut next week.

The US Consumer Price Index (CPI) for August showed a 0.4% month-on-month increase, slightly above the consensus forecast of 0.3% and an acceleration from July’s 0.2%. The uptick was largely driven by rising energy costs and higher shelter expenses, highlighting persistent pressures in select sectors of the economy. On an annualized basis, headline CPI held steady at 2.9%, in line with expectations but slightly higher than the previous 2.7%.

Core CPI, which strips out volatile food and energy components and serves as a closer guide to the Fed’s policy stance, rose 0.3% month-on-month and 3.1% year-on-year. Both figures matched forecasts and July’s readings, underscoring that underlying inflation pressures remain contained despite headline volatility.

While the headline CPI surprised to the upside, the stable core print reinforced the market’s view that the Fed is likely to implement a modest 25 basis point rate cut during its upcoming monetary policy meeting. Recent dovish commentary from Fed officials, coupled with softer-than-expected labor market data and a weaker Producer Price Index (PPI), has strengthened expectations for a calibrated easing of policy rather than aggressive action.

CME’s FedWatch tool reflected this sentiment, showing a 94% probability of a 25 basis point rate reduction in September, up from 90% prior to the inflation release. Traders continue to fully price in three rate cuts by the end of 2025, signaling confidence that disinflationary trends are broadly intact.

Attention is now turning to the Bank of England (BoE), which is scheduled to announce its policy decision on September 18, just one day after the Fed. Analysts widely anticipate that the BoE will leave the Bank Rate unchanged at 4.00%, having already delivered five cuts earlier in 2025. The contrasting policy trajectories — with the Fed leaning toward easing while the BoE maintains its rate — could provide near-term support to GBP/USD. Narrowing US-UK rate differentials typically benefit Sterling, adding fuel to the recent rebound in the currency pair.

From a technical standpoint, GBP/USD has exhibited bullish momentum following the US CPI release. The pair is trading above its short-term supportive bias line and the 50-day exponential moving average (EMA50), suggesting continued upside potential. The price is preparing to challenge critical resistance at 1.3585, reflecting dominance of the prevailing bullish trend in short-term trading.

The Relative Strength Index (RSI) is signaling positive momentum despite approaching overbought territory, reinforcing the short-term bullish bias. Immediate support is now observed at 1.3543, with additional layers at 1.3524 should the pair face downward pressure. On the upside, resistance is noted at 1.3582 and 1.3602, levels that could serve as critical testing points for further Sterling strength.

BUY GBPUSD

ENTRY PRICE: 1.3565

STOP LOSS: 1.3500

TAKE PROFIT: 1.3800

The euro staged a strong rebound against the U.S. dollar on Thursday, breaking a two-day losing streak and climbing decisively above the 1.1700 handle as investors weighed the European Central Bank’s (ECB) latest policy decision alongside fresh U.S. inflation data.

The rally underscored how currency traders are carefully reassessing diverging policy paths between Frankfurt and Washington, with both central banks signaling caution but leaning toward different points in the easing cycle.

As widely expected, the ECB kept its key policy rates unchanged. The Main Refinancing Rate remained at 2.15% and the Deposit Facility Rate at 2.00%, leaving borrowing conditions stable after a series of earlier tightening moves. The bank’s policy statement emphasized that inflation is “around the 2% target” and that the overall outlook remains “broadly unchanged.”

However, the projections painted a more nuanced picture. Core inflation — often viewed as a better gauge of persistent price pressures — is now seen at 2.4% in 2025 before gradually declining to 1.9% in 2026 and 1.8% in 2027. That suggests the ECB does not expect inflation to comfortably anchor below target in the medium term, raising the risk of extended restrictive policy if disinflation stalls.

Growth forecasts were also trimmed. The ECB now projects euro area GDP at just 1.0% in 2026, down from previous estimates, while leaving the 2027 outlook steady at 1.3%. This weaker medium-term growth profile reflects lingering structural headwinds — from subdued investment to fragile consumer demand — and leaves policymakers with limited room for maneuver if inflation persists.

ECB President Christine Lagarde reiterated that future policy moves would remain data-dependent, with decisions calibrated on inflation dynamics, macroeconomic developments, and financial conditions. This suggests the central bank is in no rush to pivot toward aggressive easing, even as markets increasingly speculate about rate cuts in 2025.

Across the Atlantic, U.S. inflation data offered a slightly more complicated read. The August Consumer Price Index (CPI) rose 0.4% month-over-month, up from July’s 0.2% and marginally above consensus forecasts of 0.3%. On an annual basis, headline inflation accelerated to 2.9% from 2.7%.

Core CPI — which strips out volatile food and energy prices — remained steady at 0.3% MoM and 3.1% YoY, in line with market expectations. This mix of stable core inflation and a modest uptick in headline prices suggests that while underlying pressures are easing gradually, energy and food-driven volatility continues to complicate the picture.

Markets, however, took the data in stride. Traders interpreted the figures as supportive of the Federal Reserve’s dovish tilt, with rate cut expectations firming further. According to CME’s FedWatch tool, the probability of a 25-basis-point cut in December now stands at 94%, up from 90% prior to the release. Markets are also fully pricing in three rate cuts by the end of 2025.

This divergence between the Fed and ECB outlooks continues to shape EUR/USD flows. While the Fed appears closer to easing, the ECB’s more cautious stance could give the euro some breathing space in the near term — provided Europe’s growth slowdown does not worsen materially.

From a technical perspective, EUR/USD is attempting to consolidate its recovery after yesterday’s rally. Thursday’s price action saw a modest intraday correction, largely attributed to overbought conditions on the Relative Strength Index (RSI). The emergence of overlapping negative signals on shorter timeframes hinted at weakening momentum, prompting some traders to lock in profits.

However, the broader technical landscape remains constructive. The pair continues to trade above the 50-day Exponential Moving Average (EMA50), a signal of underlying strength and trend stability. As long as the euro holds above this level, the short-term bullish structure appears intact. Limited pullbacks may serve as healthy retracements, paving the way for further gains if the euro can maintain its grip above the 1.1700 psychological threshold.

BUY EURUSUD

ENTRY PRICE: 1.1725

STOP LOSS: 1.1668

TAKE PROFIT: 1.1850

As of the early European session, BTCUSDT trades near 115,000, a three-week high.

The most visible catalyst is institutional flow: consecutive days of large-scale creations in physical Bitcoin ETFs have generated outsized spot demand and tightened free float. These ETF purchases not only enhance price elasticity but also re-shape the allocation landscape—institutions now prefer ETF wrappers, alleviating direct selling pressure on cash exchanges.

Macro-wise, softer U.S. inflation and labour prints have entrenched a “mid-cycle easing” narrative, pushing real rates lower and lifting risk-asset valuations. Bitcoin, as a high-beta asset, is a clear beneficiary. Sensitivity to CPI and other data releases remains elevated; readings that do not threaten higher policy rates amplify the already-positive ETF flow dynamics. In short, macro easing expectations provide fertile ground for ETF-driven upside.

On the daily chart, Bitcoin is oscillating and probing higher around 115,000. Immediate resistance is clustered in the 117,000–120,000 zone (prior peak + high-volume node). A sustained break on expanding volume, followed by a successful retest, would open extension toward 125,000 and beyond. Initial support sits at 113,400. A breach would shift the support band down to 107,000.

Price is currently pressing into the EMA60, so near-term upside momentum is encountering friction and a pullback is likely. The 10- and 20-day MAs remain beneath, however, offering dynamic support. Operationally, treat 113,400 as the first technical floor. If it gives way, look to the 10- and 20-day MAs for the next layer of support. It is recommended to take long positions on dips.

Trading Direction: Buy

Entry Price: 113800

Target Price: 119500

Stop Loss: 110600

Valid Until: September 26, 2025, 23:00:00

Support: 113400/111000

Resistance: 117000/120000

From the UK's perspective, inflation remains "firm," leading to a slower pace of monetary easing by the Bank of England (BoE) compared to the Federal Reserve (Fed). This divergence is expected to continue benefiting GBP/USD in the medium term. On September 11th, UK Chancellor of the Exchequer Rachel Reeves indicated that the government is considering reforms to business rates (also known as non-domestic rates), aiming to make it easier for small businesses to expand and further stimulate economic growth. Proposed measures include smoothing out sharp tax increases faced by businesses when property values rise during expansion, as well as adjusting the tax calculation method to offer greater relief when properties are improved or upgraded. These proposals come ahead of the annual budget announcement scheduled for November 26th. Now, the UK economy faces multiple challenges, including rising borrowing costs, an uncertain growth outlook, and the recent failure of a welfare cuts bill in Parliament — leading many economists to believe that the government may need to secure additional funding amounting to tens of billions of pounds. Reeves noted, "Our economy isn't broken, but it does feel stuck." Helen Dickinson, CEO of the British Retail Consortium, expressed support for the reform plans but urged the government to quickly clarify previously promised tax reductions for retail, hospitality, and leisure businesses. She added that until the budget is officially unveiled, many local employment and store investment plans will remain on hold.

On Thursday, US initial jobless claims data came in worse than expected, signaling continued weakness in the labor market. This further reinforced market expectations that the Fed will begin cutting interest rates at its upcoming policy meeting next week. In addition, this dovish outlook has put downward pressure on the US dollar index, extending its recent weak trend. Market expectations now suggest that the Fed's rate-cutting cycle will not stop in September. Meanwhile, the market has fully priced in over 100 basis points of rate cuts over the next year. Key upcoming dates include: October 30th — if the Fed cuts by 50 basis points in September, it may pause in October; if the cut is only 25 basis points, the October meeting will become much more significant; December 11th — as the final meeting of the year, it could mark a crucial point for a potential third (or second) rate cut; and May 2026th — when Fed Chair Jerome Powell's term ends, with uncertainty surrounding his reappointment. Andrew Tyler, Head of Global Market Intelligence at JPMorgan, commented: "We don't think this report poses a credible threat to the Fed's suspension of interest rate cuts in September, but a significantly hawkish data will indeed adjust the Fed's response function to the October and December meetings."

Based on the weekly chart, GBP/USD initially fell below the EMA12 but quickly rebounded with support from the Bollinger middle band, now returning above the EMA12. The RSI is nearing 60, entering a strong bullish zone. Besides, the MACD lines are about to form a golden cross. If this cross materializes, the price could break above 1.379. A strong breakout may push the pair toward 1.4, while a weaker breakout might see it retreat to around 1.32. The daily chart indicates that the Bollinger Bands are narrowing, and the moving averages are flattening, suggesting that a breakout could happen at any time. The RSI stands at 55, and although the MACD has formed a golden cross, no clear reversal signal has emerged yet. Overall, the pair is expected to rise toward previous highs near 1.379. It is recommended to buy at lows.

Trading direction: Buy

Entry price: 1.357

Target price: 1.4

Stop loss: 1.32

Support: 1.34/1.337/1.32

Resistance: 1.36/1.362/1.4

Despite a pause in the dollar's downtrend and a rise in risk appetite, gold attracted fresh safe-haven flows after news of new U.S. tariffs dented investor sentiment. The Financial Times reported late Thursday that Washington will press the G7 to impose sharply higher tariffs on Russian crude purchased by India and China, aiming to force Moscow into peace talks with Ukraine. Meanwhile, the market continues to price in three Fed rate cuts this year, with the potential for a sizable reduction at the September meeting.

According to the CME Group's FedWatch tool, the market continues to price in a 92% probability of a 25 bp cut and an 8% chance of a 50 bp reduction at the Fed's September meeting. Dovish rhetoric remains intact as softening labour-market conditions eclipse sticky inflation, underpinning non-interest-bearing gold. The U.S. CPI rose 0.4% MoM in August, twice July's 0.2% pace, lifting the annual inflation rate to 2.9%, in line with consensus. Later today, U.S. consumer-confidence and inflation-expectation prints could offer fresh cues on the Fed's rate trajectory and, by extension, USD-denominated gold. Trade headlines will also be scrutinised, while the gold is on track for a fourth consecutive weekly advance.

Labor-market data fell short of expectations again, pressuring the U.S. dollar index. Initial jobless claims for the first week of September jumped by 27,000 to 263,000, the highest level since October 2021 and well above consensus. The print is notable for two reasons: (i) the single-week increase is the largest in nearly three years, pointing to a rapid contraction in labour demand; and (ii) unadjusted claims in Texas surged by 15,300, suggesting a regional or sector-specific—possibly energy- or tech-related—deterioration in employment conditions. While continuing claims came in marginally below forecast, indicating that long-term unemployment has yet to deteriorate, the abrupt spike in initial claims is typically viewed as an early-cycle signal of an economic inflection point.

On the hourly chart, gold pierced the upper Bollinger band but was quickly rejected. After finding support at the lower band, it rebounded sharply. The MACD fast-slow line has printed a golden cross and an "angel-kiss" continuation pattern. RSI reads 66, signalling strong bullish momentum that is likely to retest the recent 3,675 high and possibly extend beyond 3,700. A renewed slide below 3,610 would open room for a probe toward the EMA200 at 3,581.

Weekly, price broke above the upper boundary of a symmetrical triangle and has since ridden the upper Bollinger band higher. The bands are widening, the moving-average stack is fanning upward and MACD has registered a golden cross. RSI at 72 is in overbought territory, leaving the market vulnerable to a pullback. Overall, a throwback to the triangle's former resistance-turned-support is probable before the next leg up. Provided the EMA12 holds, the up-trend remains intact.

In conclusion, the advised trading strategy is to buy dips and favour longs.

Trading Direction: Buy

Entry Price: 3651

Target Price: 3900

Stop Loss: 3550

Support: 3600/3550/3400

Resistance: 3700/3800/3900

U.S. Consumer Price Index (CPI) inflation rose again in August, with headline CPI climbing to 2.9% year-over-year while core CPI held steady at 3.1%. The recent relief from falling gasoline prices is being offset by renewed price pressures in housing and food, while prices of consumer goods such as electronics and clothing are also trending higher as tariffs from the Trump administration begin to trickle down to consumers.

Money markets in the U.S. have now fully priced in three quarter-point interest rate cuts from the Federal Reserve (Fed) before the end of the year. The Fed is widely expected to deliver an initial 25 basis point cut at its policy meeting next week, with markets also anticipating two additional rate cuts at the Federal Open Market Committee (FOMC) meetings scheduled for October and December.

Adding to the dovish tone, initial jobless claims for the week ending September 6 surged to 267K, well above the consensus estimate of 235K and notably higher than the previous reading of 237K. This sharp increase underscores renewed weakness in the labor market, which could further strengthen the case for the Fed to move swiftly on policy easing.

According to CME’s FedWatch Tool, futures traders are now fully pricing in three rate cuts by year-end. Markets view a 25 basis point cut at the upcoming September 17 FOMC meeting as virtually certain, while the probability of additional cuts on October 29 and December 10 has climbed to nearly 95%.

Meanwhile, U.S. Producer Price Index (PPI) data surprised to the downside, with headline PPI falling 0.1% month-over-month in August versus a forecasted 0.3% increase, bringing the annual rate down to 2.6% compared to the expected 3.3%. Core PPI also declined 0.1% on the month, missing expectations for a 0.3% gain and dragging the annual rate to 2.8% from a projected 3.5%.

On the political front, the U.S. Senate Banking Committee advanced the nomination of Stephen Miran to the Federal Reserve Board in a 13-11 vote on Wednesday, sending it to the full Senate just ahead of next week’s FOMC meeting. Miran, who also serves on the White House Council of Economic Advisers, is seen as supportive of faster rate cuts. However, his dual role has raised concerns about the Fed’s political independence.

Separately, the Trump administration said Wednesday it will appeal a federal judge’s ruling that temporarily blocked President Donald Trump from firing Fed Governor Lisa Cook. The case stems from allegations made prior to her confirmation, which the court ruled did not meet the “for cause” standard required under the Federal Reserve Act.

In addition, the Bureau of Labor Statistics (BLS) revised down its annual benchmark payroll figures by -911K for the 12 months through March 2025, well below economists’ estimates of -682K, adding further weight to signs of labor market weakness.

XAUUSD is currently rebounding from its 100-period moving average on the 1-hour chart. If this support holds, the ongoing uptrend could resume from this zone, offering buying opportunities on dips. The 100-period moving average sits near 3630, while the 200-period moving average lies around 3578 — a level that has also acted as a solid support zone in previous pullbacks and could serve as the next downside target if the price weakens further.

Meanwhile, the RSI has dropped to 32, approaching oversold territory. Traders will be closely watching price action as it tests this support area, with a sustained rebound potentially setting the stage for another move toward the all-time high near 3673.

Trading direction: Buy

Entry price: 3620

Target price: 3670

Stop loss: 3580

Validity: Sep 19, 2025 15:00:00