American FX Outlook: The US Dollar retreats lower as Treasury yields stall

What you need to know before markets open

• The US Treasury yields pushed higher towards 3.0% level on Monday supporting the US Dollar, but the move got exhausted on Tuesday with yields stabilizing at around 2.96%.
• The headline German IFO business climate indicator retreated lower in April falling below market expectations.
• The US house prices and the new home sales are considered a rather second tier macroeconomic indicators that are unlikely to move the market.

Tuesday’s market moving events

• The US S&P/Case Shiller house price index is expected to rise 6.3% y/y in February.
• The US news home sales are seen rising 1.9% m/m in March to 630K up from 618 K in the previous month.

Major market movers

• The US Dollar retreated lower on Tuesday as the US Treasury yields stall at around 2.96%
• With the lack of macro drivers, the corrective market sentiment prevails on the currency market.

Earlier in Asia/Europe

• The Australian CPI increased 0.5% Q/Q while increasing 2.0% y/y in Q1 2018, in line with expectations.
• The Bank of Japan measure of inflation increased 0.7% y/y in  March.
• Swiss trade balance reached a surplus of CHF 6.5 billion in Q1 2018, down from 8.2 in Q4 2017.
• German IFO business climate indicator decelerated above expectations to 102.1 in April from 103.3 in March after the pool of surveyed companies was increased to 9,000 including services.
• The UK public sector net borrowing decreased by £ 260 million in March, the lowest March net borrowing since 2004.
• The UK CBI industrial trends remained stable at 4% in April.