Forex Today: US key data releases take centre stage

Pablo Piovano FXStreet

The Greenback shrugged off its bearish start to the week and regained decent upward momentum on Tuesday, supported by a modest recovery in US yields. This came as President-elect Donald Trump proposed implementing tariffs on imports from Canada, Mexico, China, and the EU.

Here is what you need to know on Wednesday, November 27:

The US Dollar Index (DXY) rose to two-day highs and reclaimed the area above the 107.00 barrier. The PCE will be the salient event, ahead of the usual weekly Mortgage Applications tracked by MBA, the Chicago PMI, Durable Goods Orders, Personal Income and Spending, Wholesale Inventories, weekly Initial Jobless Claims, Pending Home Sales and the EIA’s weekly report on US crude oil inventories.

EUR/USD quickly faded Monday’s advance and returned to the sub-1.0500 zone following further gains in the Greenback. Germany’s GfK Consumer Confidence will be the only data release along with the speech by the ECB’s Lane.

GBP/USD followed its risk-associated peers and remained on the back foot following an early bullish move above 1.2600.

USD/JPY added to Monday’s decline and receded to multi-day lows just below the 153.00 support following a marked appreciation of the Japanese Yen.

AUD/USD lost further ground and clinched fresh multi-week lows in the 0.6435-0.6430 band amid the resumption of the buying interest in the US Dollar and weak commodity prices. Next on tap in Oz will be the RBA’s Monthly CPI Indicator, followed by quarterly Construction Work Done.

Diminishing geopolitical concerns weighed on crude oil prices on Tuesday, dragging the barrel of the American WTI to multi-day lows near the $68.00 mark.

Gold prices reversed an early pullback to the boundaries of the $2,600 mark per troy ounce, eventually ending the day with marginal gains. Silver prices regained some composure and partially reversed Monday’s pronounced drop, although another test of the $31.00 mark per ounce remained elusive.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

GBP/USD holds above 1.3350 with the 200-day SMA capping gains

The British Pound appreciates against the US Dollar on Tuesday to trim previous losses and return to the 1.3375 area, aiming to retest resistance at the key 200-day Simple Moving Average. This is a popular indicator, which lies a few pips below 1.3400 and has been capping Pound’s recovery over the last two weeks.

EUR/USD consolidates gains above 1.1400

Following an earlier move to multi-day peaks past 1.1460, EUR/USD has now slipped back toward the low 1.1400s as the NA session draws to a close on Tuesday. Declining bets for potential Fed tightening later in the year coupled with poor US CPI data hurt the US Dollar, lending fresh legs to the pair and the broader risk-linked universe. Moving forward, the release of US PPI and Chair Warsh’s second testumony should keep investors entertained on Wednesday.

Gold battles to recover the $4,100 mark

Gold reverses the recent weakness and reclaims the area beyond the key $4,000 mark per troy ounce on Tuesday. The precious metal’s recovery picks up pace and approaches the $4,100 region following the Greenback’s decline and comments from the Fed’s Warsh.

Bitcoin, crypto market post gains following weaker US inflation reading

The crypto market posted gains on Tuesday following the release of the US Consumer Price Index (CPI) report for June, which showed that inflation cooled below market expectations. According to the US Bureau of Labor Statistics, annual inflation slowed to 3.5% in June from 4.2% in May, marking its first decline in five months and coming in below the consensus forecast of 3.8%.

Fed Chair Warsh reaffirms they will deliver price stability

While testifying on the Semiannual Monetary Policy Report before the US House Financial Services Committee, Fed Chairman Kevin Warsh reiterated that the Fed is making a commitment on price stability and the goal of 2% inflation.

Five sessions, one round trip: Why the whipsaw is exactly what Warsh ordered

Markets opened July with a December hike as the base case and spent five trading sessions unlearning and relearning it. A 57K payrolls print bled the tightening bets out of the strip; a re-shut Strait of Hormuz is pushing them back in. Wednesday's minutes from the June FOMC meeting landed mid-round-trip, describing a world that had already stopped existing.