Markets Tank Again, Dollar Dominates

At the same time, the USD seemed unstoppable, rising to new cycle highs, pushing the EURUSD pair closed to 0.95, while GBPUSD fell to 1.07. Moreover, commodity-linked currencies suffer, posting multiple-year lows.

WTI oil trades near 77 USD, the lowest since January 2022. Gold dropped toward 1,600 USD, the lowest level since the COVID crash in 2020, as US yields post new highs nearly every day.

Data on the August Pending Home Sales and Goods Trade Balance will be presented in the US economic calendar in the second part of the day. Jerome Powell, chairman of the FOMC, and Christine Lagarde, president of the European Central Bank, will also make presentations.

EU enters recession

Meanwhile, the German GfK consumer climate index for the next months dropped drastically to -42.5 in October from a revised lower -36.8 the month before, setting a new record low.

Ursula von der Leyen, president of the European Commission, stated late on Tuesday that sabotage was to blame for the damage to the Nord Stream pipelines and threatened the "strongest possible response" if other assaults on vital European energy infrastructure occurred.

The late-Tuesday report that the Russian gas monopoly Gazprom may try to have the Ukrainian gas pipeline operator Naftogaz Ukrainy added to Russia's list of sanctioned companies has only added to the region's problems.

As a result, it would be unable to pay Ukraine its customary transit costs, which would allow for the suspension of physical shipments and the eventual cutoff of practically all of its remaining supplies to the EU.