The USD-index trended lower with market participants position squaring ahead of todays’ FOMC meeting with US GDP Annualized (Q1 A) Q/Q 0.2% vs. Exp. 1.0% adding to the long list of weak data from the US in Q1. Despite the weaker data, UST’s remains in negative territory with 10y yields breaching above 2% for the first time since March 17th and RANsquawk sources noted carry-trade driven hedge fund buying in USD/JPY offering marginal support to the pair however paring all of its earlier gains heading into the European market close. For EUR/JPY, main desks are eyeing a break of 131.50 which could result in the cross to test 135.00. GBP/USD has benefitted from broad based USD weakness and reached 8 week highs as investors are caught short shrugging off some of the political uncertainty surrounding the UK. EUR/USD also posted fresh 8 week highs bolstered by the softer USD as well as positive rhetoric from EU’s Moscovici stating that negotiations are close however, maintaining that progress remains slow.
Commodity-linked currencies are the main benefactors of the weaker USD as basic materials and crude oil reside firmly in the green with AUD/USD sitting comfortably above 0.800 printed highs not seen since January 21st.
Looking ahead sees the release of Japanese Industrial Production, Russian rate decision, German Unemployment change, ECB economic bulletin, US ISM Milwaukee, Chicago PMI, EIA NatGas storage change and BoJ rate decision as well as possible comments from BoC Poloz, BoJ Kuroda, Fed’s Tarullo (Voter, Dove).
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EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.