ECB’s Panetta: Interest rates should be kept at their current high level for longer
European Central Bank board member Fabio Panetta, in a webinar on Thursday, supported keeping interest rates high for longer.
“Emphasizing persistence may be particularly valuable in the current situation, where the policy rate is around the level necessary to deliver medium-term price stability, the risk of a de-anchoring of inflation expectations is low, inflation risks are balanced and economic activity is weak,” Panetta said.
Meanwhile, the Greenback has been performing well and maintaining its rally, pushing the USD Index (DXY) to flirt with fresh four-week highs around the 103.00 mark.

The Pound Sterling (GBP) continues its two-day losing spell as investors seem cautious ahead of the interest rate decision by the Bank of England (BoE). The GBP/USD pair faces pressures of bearish market sentiment and fears of a deep recession in the United Kingdom as the central bank prepares to raise interest rates consecutively for the 14th time.
The USD/JPY tends to have a positive correlation with the USD/CHF and USD/CAD, they all use the U.S. dollar as the base currency. The Yen is sensitive to factors related to Asian stock exchanges and due to the interest rate differential with other major currencies, it is also sensitive to any change affecting the so-called “Carry Trade”.

The Swiss National Bank (SNB) is expected to remain hawkish and hike 25 bps at its September meeting. The SNB also continues to guide the nominal Swiss Franc higher.
Given that USD/CHF is now rallying, the SNB may need more of that trade-weighted Swiss Franc appreciation to come via EUR/CHF. That could mean that 0.9650 now proves the top of a new – and lower – 0.9500-0.9650 range.
Gold price (XAU/USD) looks supported above the immediate support of $1,930.00, but the downside seems favored as the United States labor market data arrives more resilient than expectations. Stellar additions to private payrolls in July indicate that the Nonfarm Payrolls (NFP) report should outperform consensus on Friday. Additionally, Federal Reserve (Fed) policymakers may now consider a continuation of the rate-tightening cycle at its September policy meeting.
Litecoin (LTC), one of the largest altcoins in the crypto ecosystem, went through a halving event on August 2 in which the mining reward per block was slashed in half. Contrary to popular expectation, Litecoin price plummeted in response to the event, dropping to a fresh monthly low of $85.61