Forex Today: Risk appetite weighs on the greenback

Valeria Bednarik FXStreet

What you need to know on Wednesday, June 23:

Optimism returned to financial markets and weighed on the dollar. However, USD losses were limited and continue to look corrective after last week’s rally. US Federal Reserve chief Jerome Powell testified before Congress on the Fed’s response to the pandemic.

Earlier in the day, Cleveland Federal Reserve President Loretta Mester said she is not yet thinking about adjusting monetary policy and added that she'd like to see further progress on employment. Additionally, she said that "the Fed should be methodical in approach to tapering and communicate with the public to avoid surprises."

High-yielding currencies posted modest intraday advances. EUR/USD is currently trading at 1.1950, GBP/USD stands at 1.3960, while AUD/USD hovers around 0.7560. The USD/CAD pair approached the 1.2300 level, while USD/JPY nears 2021 high at 110.96.

UK Health Minister Matt Hancock said covid-related data looks encouraging and suggests lockdown can fully end on July 19 as planned because a recent rise in cases is not resulting in deaths.

Concerns arose globally after the report of a new covid variant called Delta Plus, which may trigger new waves.

Little action around commodities. Gold keeps hovering around $ 1,780 a troy ounce, while crude oil prices retained gains. WTI settled at $73.00 a barrel.

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD looks sidelined around 1.1850

EUR/USD remains on the back foot, extending its bearish tone and sliding towards the 1.1850 area to print fresh daily lows on Monday. The move lower comes as the US Dollar gathers modest traction, with thin liquidity and subdued volatility amplifying price swings amid the US market holiday.

GBP/USD flirts with daily lows near 1.3630

GBP/USD has quickly given back Friday’s solid gains, turning lower at the start of the week and drifting back towards the 1.3630 area. The focus now shifts squarely to Tuesday’s UK labour market report, which is likely to keep the quid firmly in the spotlight and could set the tone for Cable’s next move.

Gold battle around $5,000 continues

Gold is giving back part of Friday’s sharp rebound, deflating below the key $5,000 mark per troy ounce as the new week gets underway. Modest gains in the US Dollar are keeping the metal in check, while thin trading conditions, due to the Presidents Day holiday in the US, are adding to the choppy and hesitant tone across markets.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

XRP steadies in narrow range as fund inflows, futures interest rise

Ripple is trading in a narrow range between $1.45 (immediate support) and $1.50 (resistance) at the time of writing on Monday. The remittance token extended its recovery last week, peaking at $1.67 on Sunday from the weekly open at $1.43.