The US dollar index is building on yesterday’s gains as traders seek out safe havens on the back of China GDP concerns. China is projecting growth of ‘just’ over 6% as the trade war bites, forcing traders to turn the perceived safety of the Greenback.
Dollar pairs are struggling, with the AUD/USD trading below the 0.7100 level and slowing further below last week’s losses. The RBA kept rates on hold at 1.50%.
Meanwhile, the EUR/USD crashed below 1.1350 yesterday after reversing Monday’s early opening gap lower. The GBP/USD followed suit, with early promise giving way to selling pressure that forced the pair below 1.3200, with follow on selling this morning.
Elsewhere, the USD/CAD continues to gain following the March 1st rally that pushed the pair to 1.3300. The USD/CHF remains rangebound however, struggling to make any progress either way from the 1.0000 parity line.
The yen pairs are mixed, with the USD/JPY making gains and challenging the 112.00 level. The AUD/JPY is unchanged and holding the 79.00 level. The EUR/JPY is enjoying small gains after falling below 127.00, while the GBP/JPY is unchanged after significant losses below 148.00 yesterday.
At 09.30, we have UK Services PMI.
FOMC Member Resengren speaks at 12.30.
ISM Non-Manufacturing PMI is at 15.00.
BOE governor Carney speaks at 15.35.
The USD/JPY remains poised for higher levels as markets balance the two safe havens. The dollar has momentum behind it, making bets on higher levels attractive.