Forex Today: Markets remain choppy as Powell takes centre stage

Matías Salord FXStreet

Here is what you need to know on Tuesday, March 7:

A quiet beginning for a busy week. Wall Street trimmed gains late on Monday to post a mixed close. The US Dollar also finished with mixed results, as market participants await new guidance from Fed Chair Jerome Powell that will testify before the US Congress on Tuesday and Wednesday. Also, US job numbers are on the radar (ADP on Wednesday, Jobless Claims on Thursday and NFP on Friday). The DXY lost 0.15%, falling below 104.50.

The Euro was among the top performers supported by higher Eurozone bond yields following hawkish comments from European Central Bank (ECB) officials. EUR/USD hit weekly highs near 1.0700 and trimmed gains. EUR/GBP rose back above 0.8800. GBP/USD fell modestly after being unable to break 1.2050. The CHF rose across the board after higher-than-expected inflation data from Switzerland.

Government bond yields rose and weighed on the Yen. The US 10-year yield rose from 3.83% and peaked at 3.90%. USD/JPY is hovering around 136.00. The Bank of Japan will announce its decision on monetary policy on Thursday.

The Kiwi and the Aussie were the worst performers in the G10 space. AUD/USD dropped toward 0.6700, holding into a familiar range. NZD/USD hit the lowest in almost a week near 0.6170. The Reserve Bank of Australia will announce its decision on Tuesday. A 25 bps rate hike is expected. Chinese data is also due on Tuesday.

The USD/CAD remained in a range around 1.3600 ahead of Wednesday’s Bank of Canada meeting and Friday’s Canadian employment report.

Gold hit weekly highs above $1,850/oz but then pulled back, hit by higher yields and with investors moving to the sidelines waiting for Powell. Silver fell to $21.00. Crude oil prices rose more than 1%. Cryptocurrencies finished mostly flat.

Like this article? Help us with some feedback by answering this survey:

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

EUR/USD trims gains, back below 1.1800

EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.

GBP/USD off highs, recedes to the sub-1.3500 area

Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.

Gold climbs to weekly tops, approaches $5,100/oz

Gold keeps the bid tone well in place at the end of the week, now hitting fresh weekly highs and retargeting the key $5,100 mark per troy ounce. The move higher in the yellow metal comes in response to ongoing geopolitical tensions in the Middle East and modest losses in the US Dollar.