Euro fell in European trade on Wednesday against a basket of major rivals, extending losses for the second day against yen and backing off 15-year peak on active profit-taking. 

Euro is pressured by recent Euro zone data which indicated the economy is falling into recession faster than expected.

EUR/JPY

EUR/JPY fell 0.2% to 158.40, with a session-high at 158.93, after losing 0.65% yesterday, the first loss in four days, and the largest since October 3 on active profit-taking after marking 15-year highs at 159.92. 

Recession

Recent European data showed the manufacturing and services sectors shrank in October, flaming concerns of recession during the fourth quarter.

The European economy is undergoing one of its worst periods of contraction as spending wanes and the Chinese economy weakens.

Thus the European Central Banks has strongly hinted last September that no more interest rate hikes will be announced.

The 160 Yen Barrier

The 160 yen barrier continues to hold ground, with Japanese authorities likely intervening if threatened to underpin the currency. 

Japanese authorities indicated it'll stand on the sidelines unless yen weakens too excessively against its European or US rivals. 

Gold prices fell in European trade on Wednesday for the third straight session off five-week highs on active profit-taking.

The dollar rose against a basket of major rivals, pressuring dollar-denominated metals and commodities as markets await more clues on the likely path ahead for US monetary policies. 

Gold Prices Today

Gold prices fell 0.15% to $1,968 an ounce, with a session-high at $1,977, after losing 0.1% on Tuesday, the second loss in a row on profit-taking off a five-month high at $1,977.

The Dollar

The dollar index rose 0.1% on Wednesday, extending gains for the second day against a basket of major rivals. 

The gains came after positive US manufacturing and services data, in a sign of solid US growth in the fourth quarter.

Such data underpinned prospects of another 0.25% interest rate hike before the year end. 

US Rates

Chances for another 0.25% US interest rate hike in November stood unchanged at 2%, while odds for a similar hike in December stood at 25%. 

Powell

Later today, Fed Chair Jerome Powell will speak in Washington DC, and could offer clues on the path ahead for US policies. 

The SPDR 

Gold holdings at the SPDR Gold Trust remained flat yesterday at 860.07 tonnes. 

Euro fell in European trade on Wednesday against a basket of major rivals, extending losses for a second session against the dollar and away from a five-week high on profit-taking,

Concerns are renewed about European economic recession following grim manufacturing and services data for October, hurting chances of another ECB rate hike. 

EUR/USD

EUR/USD fell 0.1% to 1.0584, with a session-high at 1.0606, after losing 0.75% on Tuesday, the first loss in four days, and the largest in two weeks on profit-taking away from a five-week high at 1.0695. 

Euro has fallen against the greenback after strong US manufacturing and services data, indicating solid growth in the world's largest economy.

Recession 

Recent European data showed the manufacturing and services sectors shrank in October, flaming concerns of recession during the fourth quarter.

The European economy is undergoing one of its worst periods of contraction as spending wanes and the Chinese economy weakens. 

Thus the European Central Banks has strongly hinted last September that no more interest rate hikes will be announced. 

The ECB

The European Central Bank is convening today, widely expected to maintain interest rates unchanged. 

Gold prices fell on Tuesday as the dollar rose against most major rivals, while US treasury yields gain ground.

Interest rate-sensitive US treasury yields rose today as markets assess latest US data, which showed forecast-beating strength, paving the way for an extended duration of policy tightening. 

US two-year treasury yields rose 6 basis points to 5.119%, after an earlier spike to 5.136%, the fastest such increase in a week. 

Markets continue to monitor the situation in the Middle East as the situation continues to deteriorate in the Hamas-Israel war. 

Both Alphabet and Microsoft will release quarterly results later today after the close of the session.

According to initial data, the combined US PMI clocked in 51 in October, up from 50.2 in September, the highest in three months. 

US services PMI rose to 50.9 this month from 50.1 in the previous reading. 

Finally, US manufacturing PMI rose to 50 this month from 49.8. 

Otherwise, the dollar index rose 0.7% as of 20:30 GMT to 106.2, with a session-high at 106.3, and a low at 105.3.

Gold spot prices fell 0.2%, or $4.5 as of 20:30 GMT to $1,983 an ounce.