Broad-based US dollar comeback was the main theme in Asia across the forex board this Tuesday, as a rally in 10-year Treasury yields lifted the sentiment around the dollar that was downed by dovish Fed Chair Powell’s comments and Fed pause risks.
USD/JPY staged a solid rebound aiming towards 109.00, while EUR/USD was one of the biggest loser this session, dragged back below 1.1450 barrier, straggling a comeback to the highs. GBP/USD traded better offered near 1.2760 region amid looming Brexit jitters.
Tuesday sees a busy European calendar, but with a void of first tier macro releases. Markets brace for the much-awaited German industrial figures that drops in 07:00 GMT. From the Euroland, a raft of confidence numbers will be released at 10:00 GMT. Meanwhile, the UK docket remains light, with the only Halifax house prices on the cards. Apart from the data, the Brexit-related headlines will remain the primary focus in the EU session, as the Brexit deal vote is scheduled early next week.
In the NA session, the trade balance data from the US will drop in at 13:30 GMT, followed by the US JOLTS job openings at 15:00 GMT. At 21:30 GMT, the API weekly crude data will be out that will offer fresh trading impetus to the oil.
Oil prices continue to trade higher. Saudi Arabia plans to aggressively cut oil exports to boost prices as news suggests supporting the stock prices. Also, markets expect some easing of trade dispute from the US-China talks that began yesterday. Rising momentum is likely to continue this week, taking the prices to higher. However, concerns of a worldwide economic slowdown were cited as a headwind for oil prices as investors fear it would dent fuel consumption.
Gold prices slid on Tuesday in Asia, as the U.S. dollar rebounded after falling for a fourth straight session amid expectations that the U.S. Federal Reserve may halt its rate-hiking cycle for the year. Prices of the yellow metal tend to rise when rate hike expectations ease because lower rates reduce the opportunity cost of holding non-yielding bullion.