What you need to know on Thursday, August 1:
The Federal Reserve's rate cut supports the USD against all other currencies. The Fed cuts rates as expected amid weak inflation and weaker global demand, but stressed that the outlook is favorable for the US economy. ISM Manufacturing PMI is the main data point today and serves as another hint toward Friday's Non-Farm Payrolls. The ADP jobs report came out within expectations at 158K.
EUR/USD has dropped to the lowest level in two years. It also suffered amid weak core CPI in July. It faces the final manufacturing purchasing managers' indices today.
GBP/USD is falling as Boris Johnson's government doubled its budget set out for a hard Brexit as well as the Fed.
The BOE is set to leave interest rates unchanged but may drop its intention to raise rates assuming a smooth Brexit. The global slowdown and the higher risk of a no-deal Brexit may shift the BOE's bias. Today's event is a "Super Thursday" one with the bank publishing its Quarterly Inflation Report and holding a press conference led by Governor Mark Carney.
The US and China have concluded the first round of talks since May and referred it as "constructive" and will meet again in September.