This morning, the US dollar is backing off after heft gains made yesterday on the back of Fed Chair Powell’s testimony. The speech appeared to cement previous analysis that rate hikes were on the cards.
Dollar pairs are making small gains this morning, with the NZD/USD and AUD/USD making good some of yesterday’s losses. By contrast, the GBP/USD is struggling to recover, while the EUR/USD makes small losses.
The biggest moves yesterday were seen on the USD/CAD which rose sharply with reversing oil prices and a strong dollar.
Yen pairs are uniformly lower this morning, as dollar interest subsides and yen interest increases. The EUR/JPY is notable for extending its recent poor run.
Meanwhile, gold hit a two year low overnight in the face of the resurgent dollar.
Coming up today, we have European CPI flash estimate at 10.00.
At 13.30, we get Canadian RMPI.
Also at 13.30, we have US preliminary GDP.
Chicago PMI is at 14.45.
Pending home sales are at 15.00.
US Crude oil inventories are at 15.30.
The yen pairs are under near constant attack as market seek out safe havens and money flows from dollar pairs into the yen.
The euro continues to look vulnerable, with lower levels on the cards.