Forex Market Outlook for September 23, 2026: Dollar Strength, EUR/USD and GBP/USD in Focus
The forex market is heading into another potentially volatile session on Wednesday, September 23, 2026, with traders closely watching the US dollar, euro, British pound and Japanese yen.
The US dollar has recently regained strength as markets reassess the Federal Reserve’s interest-rate outlook. The Fed raised its benchmark interest-rate target by 25 basis points on September 16, taking the target range to 3.75%-4.00%, while the central bank indicated that inflation remains elevated.
That backdrop has kept the dollar relatively firm against several major currencies. At the same time, higher oil prices, elevated US Treasury yields and geopolitical developments are creating additional uncertainty for currency traders.
So, what should forex traders watch on September 23?
US Dollar Outlook
The US dollar remains one of the main stories in the forex market this week.
The Dollar Index was around 100.36 on September 22, according to market reports, after gaining more than 1% during the previous week. The rise has been supported by the Fed’s recent rate hike and expectations that US interest rates could remain relatively high.
US 10-year Treasury yields have also moved close to 5%, helping maintain the dollar’s yield advantage over some other major currencies. Rising oil prices have added another layer of complexity because higher energy costs could keep inflation pressures elevated.
For September 23, traders will therefore be watching whether the dollar can maintain its recent momentum or whether profit-taking starts to appear after its latest gains.
EUR/USD: Euro Remains Under Pressure
EUR/USD is likely to remain one of the most closely watched currency pairs on Wednesday.
The pair was trading around the 1.1460 area on September 22, with the euro facing pressure as the US dollar recovered. A major factor behind the move is the difference between expectations for US and European monetary policy.
Recent technical analysis has also highlighted the 1.1460 area as an important short-term zone. If EUR/USD remains below recent resistance levels, sellers could continue to test lower levels.
On the other hand, a stronger-than-expected European economic release could give the euro some temporary relief.
What could move EUR/USD?
European PMI numbers will be important on September 23. Flash manufacturing and services PMI figures for France, Germany and the wider euro area are scheduled during the European session.
If the data shows stronger-than-expected business activity, the euro could find some support. A disappointing set of numbers could have the opposite effect.
GBP/USD: Pound Faces a Difficult Setup
GBP/USD has also been under pressure.
The pair was trading around 1.3368 on September 22, according to Sucden Financial’s daily FX analysis. The pair remains below several important moving-average resistance areas, while the stronger US dollar has added pressure to sterling.
The 1.3400 area is an important level to watch in the short term. A sustained move above that zone could improve the technical picture, while continued rejection around resistance could keep the pair under pressure.
The British pound will also react to the UK’s preliminary PMI data scheduled for September 23. Current estimates show manufacturing PMI around 51.5 and services PMI around 52.0.
Traders should remember that the actual numbers can produce sharp moves when they differ significantly from expectations.
USD/JPY: Yen Weakness Remains in Focus
USD/JPY is another pair that could see significant volatility.
The pair was around 157.4 on September 22, with the dollar benefiting from the large US-Japan yield differential. The Bank of Japan has also recently raised rates, but its guidance has not been strong enough to remove pressure from the yen.
The 158 area is particularly important from a technical perspective. A sustained break above that level could attract additional attention from traders, while a rejection could trigger a pullback.
However, the Japanese yen comes with an additional risk: intervention.
Japanese authorities have reportedly conducted rate checks, which markets often interpret as a possible warning before direct currency-market intervention. This means traders should be prepared for sudden and unusually large moves in USD/JPY.
Forex Economic Calendar for September 23
Several economic releases are scheduled for Wednesday.
Among the important events are:
- Australian Flash Manufacturing PMI
- Australian Flash Services PMI
- French Flash Manufacturing PMI
- French Flash Services PMI
- German Flash Manufacturing PMI
- German Flash Services PMI
- Eurozone Flash Manufacturing PMI
- Eurozone Flash Services PMI
- UK Flash Manufacturing PMI
- UK Flash Services PMI
- US Flash Manufacturing PMI
- US Flash Services PMI
- FOMC member Barr speaking
- US Crude Oil Inventories
These releases can create short-term volatility, particularly when the actual figures differ from market expectations.
Oil Prices Could Affect Forex Trading
Crude oil remains an important factor for currency markets.
Brent crude moved back above $100 per barrel on September 22, with Reuters reporting Brent around $101.67. Higher energy prices are contributing to concerns about inflation and interest rates, while also affecting currencies of oil-importing and oil-exporting economies differently.
For forex traders, a sharp move in oil prices could indirectly influence the US dollar, Japanese yen and other major currencies.
The relationship is not always straightforward, but oil should remain on the watchlist throughout Wednesday’s session.
What Could Happen in Forex on September 23?
There are several possible scenarios for the market.
Scenario 1: Dollar Strength Continues
If US economic data remains strong and Treasury yields stay elevated, the dollar could continue to find buyers.
This could keep pressure on pairs such as EUR/USD and GBP/USD while supporting USD/JPY.
Scenario 2: Dollar Takes a Pause
After the recent dollar rally, traders could start booking profits.
In that situation, EUR/USD and GBP/USD could experience a short-term recovery, particularly if European or UK economic data beats expectations.
Scenario 3: Volatility Increases
The third possibility is a volatile session in which currencies move sharply in both directions.
This could happen if economic data surprises the market, oil prices make another large move, or fresh geopolitical headlines emerge.
For short-term traders, this type of environment can be particularly challenging because an initial breakout may quickly reverse.
Key Forex Levels to Watch
Based on the current market setup, traders may want to keep an eye on these areas:
EUR/USD: The 1.1460 region and nearby resistance/support zones.
GBP/USD: The 1.3400 area is an important short-term reference point.
USD/JPY: The 157-158 zone is likely to attract significant attention, especially because of intervention concerns.
These are market reference levels rather than guaranteed support or resistance points. Price action and economic news can change the technical setup quickly.
Final Forex Market Outlook
The forex market enters September 23 with the US dollar in a relatively strong position, but that does not necessarily mean the dollar will move higher throughout the entire session.
The Federal Reserve’s recent rate hike, elevated US Treasury yields and persistent inflation concerns are supporting the dollar. At the same time, the euro and pound are dealing with their own economic and monetary-policy challenges. The Japanese yen remains particularly sensitive to the US-Japan rate differential and the possibility of official intervention.
For traders, Wednesday could therefore be a session where patience matters more than simply predicting the direction of a currency pair.
The most important things to watch will be the PMI data, US dollar momentum, Treasury yields, crude oil prices and comments from central-bank officials.
Rather than assuming that a currency pair must rise or fall, traders should wait for confirmation from price action and economic data before taking a position.
Risk Disclaimer
This article is provided for educational and informational purposes only. Forex trading involves substantial risk and can result in losses, particularly when leverage is used. The market scenarios discussed above are not guaranteed predictions or financial advice. Traders should conduct their own research, use appropriate risk management and consider seeking advice from a qualified financial professional before making trading decisions.
