Talking Points:
- US Dollar Index gains on EUR and GBP weakness
- Tomorrow’s data may change the course of greenback trading
A look back at the past 24 hours of Forex trading using movements in the US Dollar Index:
US Dollar 15-Minute 12:00 04/28 to 12:00 04/29 EST
The Dow Jones FXCM Dollar Index found some strength in the middle of Tuesday’s London session on a combination of weaker than expected data out of Germany and the United Kingdom.
The US Dollar gained over 40 pips against the British Pound after the release of UK GDP for the first quarter. The United Kingdom economy expanded by 0.8% in Q1, disappointing expectations for 0.9% growth.
The greenback went on to take another 45 pips of gains against the Euro as New York traders came online. German inflation set a 3-month high in April, but still fell short of expectations. The ECB has warned that it may purchase assets if a slowdown in price gains hurts the Euro-zone recovery.
The Dollar set a new 3-day high at 10,478 after the German CPI release, and the index may continue to see volatility in tomorrow’s busy US economic calendar. Chief Strategist John Kicklighter says tomorrow’s events may not only alter expectations for US Dollar trading but also the direction of risk trends.
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Editors’ Picks
EUR/USD retreats to 1.0750 area as USD recovers
EUR/USD stays under modest bearish pressure and trades slightly below 1.0750 in the European session on Wednesday. Hawkish comments from Fed officials help the US Dollar stay resilient and don't allow the pair to stage a rebound.
GBP/USD drops below 1.2500 ahead of Thursday's BoE event
GBP/USD stays on the back foot and trades in negative territory below 1.2500 after losing nearly 0.5% on Tuesday. The renewed US Dollar strength on hawkish Fed comments weighs on the pair as market focus shifts to the BoE's policy announcements on Thursday.
Gold stays near $2,310 as US yields edge higher
Following a quiet Asian session, Gold retreated slightly to the $2,310 area. Hawkish tone of Fed policymakers help the US Treasury bond yields edge higher and make it difficult for XAU/USD to gather bullish momentum.
SEC vs. Ripple lawsuit sees redacted filing go public, XRP dips to $0.51
Ripple (XRP) dipped to $0.51 low on Wednesday, erasing its gains from earlier this week. The Securities and Exchange Commission (SEC) filing is now public, in its redacted version.
No obvious macro catalysts to steer the bus
The US data calendar remains relatively light, with initial jobless claims and the University of Michigan survey being the key focus. However, these releases may not provide a significant catalyst for the next directional move in the US Dollar.