The risk-on sentiment extended this Tuesday after the US Treasury retracted its decision in August to designate China as a currency manipulator. Further, an imminent US-China phase one trade deal signing on Wednesday amid signs of goodwill gestures for both sides buoyed the market mood.
The anti-risk yen fell to eight-month lows of 110.21 vs. its American rival in early trades. USD/JPY eased-off highs but traded above the 110.00 handle towards Asia closing. Among the European currencies, both EUR/USD and the GBP/USD consolidated the recovery gains heading into the key US data release due later Tuesday.
Oil prices are extending their gradual climb down, with WTI hovering around $58. Gold is following a similar path, trading below $1,550.
With the US-China trade deal optimism-led risk-on trading likely to continue into Europe, markets await the speech by the European Central Bank (ECB) Governing Council member Merch’s speech, due at 08:30 GMT, for some fresh incentives.
The EUR calendar today remains data-dry and therefore, the attention turns towards the US Consumer Price Index (CPI) report due to be published at 13:30 GMT for fresh dollar trades.
Apart from the US data, Fed official Williams speech, the US Monthly Budget Statement and American Petroleum Institute US Weekly Crude Oil Stock data will garner some attention.