FOREX
The US Dollar Index edged lower in early Tuesday trading but remains near the multi-week highs reached on Friday. The greenback's outlook shifted last week after a stronger-than-expected US jobs report underscored the resilience of the US economy, weakening the case for additional stimulus. This led to a repricing of market expectations for the Federal Reserve's easing path, with most traders now seeing a 50-basis-point rate cut in November as unlikely. Instead, a 25-basis-point cut is considered the most probable outcome. Meanwhile, geopolitical tensions—particularly the risk of escalating conflict between Israel and Iran—continue to drive haven demand for the dollar. Later this week, the release of the latest FOMC minutes and US inflation data will provide further clarity on the short-term direction of the greenback, with risks currently tilted to the upside.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
OIL
Brent oil prices fell in early Tuesday trading, pulling back from the multi-week highs reached in the previous session. Traders took profits after a rally that pushed prices up nearly 15%, driving the barrel above $80 for the first time since August. The primary catalyst for these gains was the escalating conflict in the Middle East, which still poses a risk to oil output from the world’s leading exporting region. However, the market’s reduced bets on further price increases suggest that the perceived threat to local oil infrastructure may have eased. Still, with Israeli retaliation against Iran anticipated, any further escalation could quickly reignite upward momentum and drive prices higher once again.
Ricardo Evangelista – Senior Analyst, ActivTrades
Source: ActivTrader
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