Following the selloff seen in the American session on Monday, the US Dollar (USD) tries to stabilize early Tuesday, with the US Dollar Index recovering from the 10-day low set at 101.20 in the early Asian session. February Housing Price Index, March New Home Sales, and the Conference Board’s Consumer Confidence Index for April will be featured in the US economic docket later in the day.
The sharp decline in US Treasury bond yields weighed heavily on the USD on Monday. The benchmark 10-year US Treasury bond yield lost more than 2% and declined below 3.5% for the first time since April 14. Early Tuesday, the 10-year yield is having difficulty staging a rebound. Meanwhile, Wall Street’s main indexes closed mixed, with the Nasdaq Composite posting modest losses and the Dow Jones Industrial Average adding 0.2%—US stock index futures trade in negative territory in the European morning.
EUR/USD capitalized on the renewed USD weakness on Monday and registered substantial gains. The pair seems to have gone into a consolidation phase around 1.1050 early Tuesday. Since there won’t be any high-tier data releases from the Euro area, the USD’s valuation and comments from European Central Bank (ECB) policymakers could drive the pair’s action.
GBP/USD closed in positive territory on Monday and continued to push higher during the Asian trading hours on Tuesday. The pair, however, lost its traction after having met resistance at 1.2500 and was last seen trading modestly lower on the day at around 1.2470.
USD/JPY closed flat slightly above 134.00 on Monday and continues to trade in a tight range on Tuesday. Earlier in the day, “We see the risk of inflation undershooting forecast as bigger than the risk of overshooting, which is why the Bank of Japan (BoJ) must maintain easy policy now,” BoJ Governor Kazuo Ueda said.
Gold prices benefited from falling US yields and gathered bullish momentum on Monday. XAU/USD continues to edge higher toward the critical $2,000 level on Tuesday.
Following Monday’s indecisive action,Bitcoinedged slightly lower early Tuesday and was last seen trading below $27,500. Ethereum lost 1% on Monday and another 1% on Tuesday, trading slightly above $1,800.