Forex Today: Eyes turn to EU inflation data amid subdued FX action
|Here is what you need to know on Tuesday, December 2:
A sense of caution prevails in early Europe even as global bond markets stabilize, following Monday’s sell-off fuelled by Bank of Japan (BoJ) Governor Kazuo Ueda.
In his speech on Monday, Ueda laid the groundwork for an interest rate hike in December, sending global yields through the roof alongside Japanese bond yields.
The US Treasury bond yields also received support as markets weighed the US Federal Reserve’s (Fed) next moves after the December monetary policy meeting due next week.
Markets continue to price an 87% chance that the Fed will lower rates by 25 basis points (bps) later this month, according to the CME Group’s FedWatch Tool.
The latest data published by the Institute for Supply Management (ISM) on Monday justified the dovish market expectations.
The US manufacturing sector contracted for the ninth straight month in November, as the ISM PMI dropped to 48.2 in November from 48.7 a month earlier. The market expectation was 48.6.
Despite weak US data, the US Dollar (USD) drew support from surging US Treasury bond yields. The Greenback holds the recovery momentum against its major currency rivals, as of writing, with the US Dollar Index (DXY) firming up near 99.50.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.04% | -0.04% | 0.22% | -0.04% | -0.20% | -0.02% | -0.10% | |
| EUR | 0.04% | 0.01% | 0.27% | 0.00% | -0.16% | 0.03% | -0.05% | |
| GBP | 0.04% | -0.01% | 0.25% | -0.00% | -0.19% | 0.03% | -0.06% | |
| JPY | -0.22% | -0.27% | -0.25% | -0.26% | -0.42% | -0.25% | -0.32% | |
| CAD | 0.04% | -0.01% | 0.00% | 0.26% | -0.16% | 0.02% | -0.06% | |
| AUD | 0.20% | 0.16% | 0.19% | 0.42% | 0.16% | 0.18% | 0.10% | |
| NZD | 0.02% | -0.03% | -0.03% | 0.25% | -0.02% | -0.18% | -0.08% | |
| CHF | 0.10% | 0.05% | 0.06% | 0.32% | 0.06% | -0.10% | 0.08% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
In the Asian session, data released by the Australian Bureau of Statistics (ABS) showed that the country’s Current Account balance experienced a decrease of $500 million in the September quarter. But the data failed to have any negative impact on the AUD/USD pair, which is up 0.15% on the day at 0.6555.
USD/JPY bounces toward 156.00, recovering from the previous decline.
EUR/USD trades in a tight range above 1.1600. Traders turn cautious as Eurostat is due to publish the Harmonized Index of Consumer Price (HICP) inflation data for November.
GBP/USD defends 1.3200, trading listlessly in the absence of any top-tier macro releases from both sides of the Atlantic.
Gold holds $4,200 in European trading, having witnessed some volatility in the early Asian hours. XAU/USD faces headwinds from higher US Treasury bond yields and a broad USD rebound.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.