Forex Today: Dollar steadies after Powell-inspired rally, eyes on high-tier US data

Here is what you need to know on Wednesday, December 1:

Following a sharp upsurge witnessed during the American trading hours on Tuesday, the US Dollar Index staged a correction and seems to have steadied around 96.00 early Wednesday. Investors await November ADP Employment Change and ISM Manufacturing PMI data from the US. FOMC Chairman Jerome Powell will testify before the US House Committee on Financial Services starting at 1500 GMT. IHS Markit will release the final readings of the November Manufacturing PMIs for the euro area, Germany, the UK and the US as well. 

ADP Jobs Preview: Dollar rally? Why the greenback is set to rise on (almost) any figure.

While testifying before the US Senate Banking Committee on Tuesday, Powell said that it would be appropriate to accelerate the pace of reductions in asset purchases and added that they would be discussing this matter in the upcoming policy meeting. Powell also noted that it was time to stop using the term "transitory" when describing inflation in the US. Following these remarks, investors are expecting the Fed to remain on the policy-tightening track despite renewed coronavirus fears.

US Manufacturing Purchasing Managers Index November Preview: Businesses are watching the consumer.

Wall Street's main indexes suffered heavy losses on Tuesday but US stocks futures are trading in the positive territory in the European morning. Meanwhile, the 10-year US Treasury bond yield is rising more than 1% on the day while staying below 1.5%.

EUR/USD climbed back above 1.1300 after falling sharply to mid-1.1200s late Tuesday. European Central Bank Governing Council member Pablo Hernandez de Cos said on Tuesday that the new coronavirus variant and the inflation spike in the euro area were pointing to a significant negative revision to the 2021 growth forecast.

GBP/USD tested 1.3200 in the American session on Tuesday but managed to stage a decisive rebound during the Asian trading hours. The pair is currently trading in the positive territory around 1.3330.

USD/JPY is holding on to modest daily gains around 113.50 supported by rising US Treasury bond yields. Bank of Japan (BOJ) board member Seiji Adachi reiterated that the BOJ is ready to ease the policy further if needed to support businesses.

Gold fluctuated wildly in the second half of the day on Tuesday. After advancing to $1,808, XAU/USD dropped all the way down to $1,770 in less than two hours. Following a consolidation phase during the Asian session, the pair is edging higher toward $1,790 in the European morning.

Cryptocurrencies: Bitcoin continues to move sideways below $60,000. Ethereum is rising for the fifth straight day on Wednesday and closes in on the all-time high it set $4,867 on November 10.

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD retains gains and trades around 1.1350

EUR/USD stays afloat in the positive territory near 1.1350 as the greenback struggles to gather strength on retreating US T-bond yields. Focus remains on mounting inflationary pressures and upcoming central banks’ announcements.


GBP/USD holds its ground in the positive territory above 1.3600

GBP/USD holds above 1.3600 in the second half of the day on Wednesday supported by the modest selling pressure surrounding the dollar. The benchmark 10-year US Treasury bond yield stays in the red in the early American session and the US Dollar Index edges lower toward 95.50.


Gold: Bullish breakout exposes November monthly high at 1,877.15

Spot gold trades above $1,840 a troy ounce, at levels last seen in November 2021. The bright metal soared through the American session amid persistent concerns about inflation and volatile US government bond yields. 

Gold News

Shiba Inu price has a good chance to surge to $0.000040

A brief technical and on-chain analysis on Shiba Inu price. FXStreet's analysts evaluate why SHIB could advance further. 

Read more

Yields everywhere are rising too far, too fast: Could we expect them to settle down?

Today we get housing starts and permits, but expectations are running low because of Omicron and bad weather. It’s not exactly an inspiring bit of data, anyway. In fact, the juicy data is from Canada, CPI today and retail sales on Friday. There is still chatter about a BoC hike next week. 

Read more