Dollar Mixed as US PCE Data, Nvidia Earnings Loom
0h ago|4 min readStandard
Fazen Markets Editorial Desk
Collective editorial team · methodology
usdforex
Fazen Markets Editorial Desk
Collective editorial team · methodology
Trades XAUUSD on autopilot. Verified Myfxbook performance. Free forever.
Risk warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The majority of retail investor accounts lose money when trading CFDs. AiX is informational software — not investment advice. Past performance does not guarantee future results.
The US dollar traded with a mixed bias on August 26 as North American markets opened, firming against several major currencies while softening against the Japanese yen and Australian dollar. According to analysis from investinglive.com, the greenback's most significant gains were against the New Zealand dollar, with NZDUSD down 0.35%, and the Swiss franc, with USDCHF up 0.34%. The Australian dollar led gains against the USD, rising 0.29%. Trading ranges remained contained, with the AUDUSD showing the widest range at 58 pips. Market focus centered on impending US inflation data and Nvidia's quarterly earnings report after the close.
Currency markets are navigating a critical session dominated by high-impact US economic releases. The core Personal Consumption Expenditures index, the Federal Reserve's preferred inflation gauge, is scheduled for release alongside revised second-quarter GDP figures. These data points arrive as central bank officials globally maintain a hawkish posture, with ECB Executive Board member Isabel Schnabel recently emphasizing the need for preemptive action against persistent inflation.
Historical context shows the core PCE has hovered around 3.3% year-over-year, significantly above the Fed's 2% target. The last time the core PCE reading saw a sustained decline below 3% was in the first quarter of 2025. Today's data will test market expectations for the Fed's policy path in September.
Geopolitical developments also provide a backdrop, with reports of Iran and Oman discussing a temporary commercial shipping corridor through the Strait of Hormuz. This has tempered immediate fears of supply disruptions, contributing to a contained trading environment for oil-sensitive currencies like the Canadian dollar. The USDCAD range was 42 pips in early trading.
The day's economic calendar is heavily weighted toward US data, with most key releases at 8:30 AM ET. Forecasts anticipate core PCE month-over-month to print at +0.2%, matching the prior reading, while the year-over-year figure is expected to hold at 3.3%. Headline PCE year-over-year is estimated at +3.6%, a slight deceleration from the previous 3.7%.
The second estimate of Q2 GDP is projected to confirm the initial reading of +1.5% growth. Consumer spending, which posted a strong preliminary estimate of +3.2%, will be closely watched for revisions. Corporate profits are anticipated to show a rebound to +0.5% after a -0.4% contraction in the prior quarter.
A comparison of trading ranges highlights the session's relative calm before the data deluge. The EURUSD range was a narrow 16 pips, while GBPUSD saw a 33-pip range. The USDJPY range was wider at 37 pips, reflecting slight yen strength. Retail sentiment data from the UK showed a sharp deterioration, with the CBI sales balance plunging to -48 from -26, indicating weak consumer demand.
The contained trading ranges suggest markets are in a holding pattern, awaiting the fundamental catalysts from US data and earnings. A core PCE reading that meets or falls below expectations could reinforce a dovish shift in Fed expectations, potentially pressuring the dollar, particularly against high-beta currencies like the AUD and NZD. Conversely, an upside surprise would likely bolster the greenback.
Nvidia's earnings after the close represent a significant risk event for equity sentiment, which indirectly influences forex markets through risk-on/risk-off flows. The company's guidance on Q3 demand for its Blackwell Ultra chips will be critical. With Target trading at $163.47, down 1.19% on the day, broader retail sector weakness could be exacerbated by any disappointment from consumer-facing tech earnings.
A counter-argument is that forex markets may have already priced in a status quo outcome from the PCE data, leading to a muted reaction regardless of the print. Flow data indicates leveraged funds remain net short the euro, suggesting positioning is light ahead of the ECB's September meeting. The Swiss UBS Investor Sentiment Index improvement to +12.1 signals regional optimism that may limit euro downside.
Immediate focus is on the 8:30 AM ET data releases, particularly the core PCE print. A deviation of more than 0.1 percentage point from the 0.2% MoM forecast could trigger volatility. The 10:30 AM ET EIA crude inventory report is also key, with expectations for a build of 597,000 barrels.
Speeches from Richmond Fed President Thomas Barkin (11:45 AM ET) and SNB's Antoine Martin (12:15 PM ET) will be monitored for policy clues. Technical levels to watch include the week's highs and lows for major pairs; a break of the 16-pip EURUSD range could signal the next directional move.
The primary near-term catalyst is the ECB's September 12 meeting, where markets price a 95% probability of a rate hike. The extent of subsequent tightening, currently estimated at 40 basis points by year-end, will be a key driver for euro crosses.
Nvidia is scheduled to report its fiscal second-quarter earnings after today's market close, with the results expected around 4:20 PM Eastern Time. The company's earnings call will follow at 5:00 PM ET. Revenue guidance is set at $91.0 billion, plus or minus 2%, while analyst estimates project revenue of $92.27 billion and earnings per share of $2.09.
The technical analysis outlined for the trading day describes a specific bias, risk-defining level, and target for EURUSD. The pair exhibited a very tight 16-pip trading range in early session activity, indicating consolidation ahead of the US data. The broader directional bias will likely be determined by the outcome of the PCE inflation report and subsequent market reaction.
The Confederation of British Industry's distributive trades survey for August showed a severe deterioration, with the retail sales balance crashing to -48 from -26. This signals profoundly weak consumer demand and worsening business sentiment in the UK, which is a negative fundamental factor for the British pound. The report contributes to a cautious stance on GBP ahead of the Bank of England's next policy decision.
The US dollar's near-term trajectory hinges on inflation data matching high expectations and Nvidia affirming its growth outlook.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.
AiX is our free MetaTrader 4 Expert Advisor. Verified Myfxbook performance. No subscription. No fees. XAUUSD breakout engine.
Trade forex with tight spreads from 0.0 pips
Open AccountSponsored
Open a demo account in 30 seconds. No deposit required.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.