The US Dollar (USD) is finding it difficult to build on Tuesday recovery gains early Wednesday as investors’ focus shift to upcoming data releases. Led by tech-heavy Nasdaq Futures, US stock index futures trade in positive territory and the 10-year US Treasury bond yield hold steady slightly above 3.4%. Durable Goods Orders for March and Wholesale Inventories will be featured in the US economic docket ahead of Thursday’s highly anticipated Gross Domestic Product (GDP) report for the first quarter.
The USD benefited from souring market mood on Tuesday after Wall Street’s main indexes opened in negative territory and continued to push lower. With Microsoft and Google Alphabet releasing upbeat earnings reports for the first quarter after the closing bell, however, technology stocks gained traction and Nasdaq Futures were last seen rising more than 1% on the day. On the other hand, major European equity indexes trade modestly lower in the early session. Meanwhile, the US Dollar Index started to edge lower 101.50 after having gained 0.5% on Tuesday.
During the Asian trading hours, the data from Australia revealed that the Consumer Price Index declined to 7% on a yearly basis in the first quarter from 7.8%. The Reserve Bank of Australia’s (RBA) Trimmed Mean CPI in the same period edged lower to 6.6% from 6.9%, coming in much lower than the market forecast of 7.2%. Softer-than-expected inflation data seem to be weighing on the Australian Dollar and AUD/USD was last seen trading at its lowest level in five weeks near 0.6600.
EUR/USD turned south on Tuesday and erased all of Monday’s gains to close below 1.1000. The pair has regained its traction early Wednesday and recovered above 1.1000 early Wednesday. Gfk Consumer Confidence Index for Germany improved to -25.7 for May from -29.3 in April, helping the Euro find a foothold.
GBP/USD fell sharply but managed to hold above 1.2400 on Tuesday. The pair benefits from the renewed USD weakness and climbs toward 1.2450 in the European morning on Wednesday.
Despite the USD’s decisive rebound on Tuesday, Gold price edged higher supported by the retreating US yields. XAU/USD stays relatively quiet on Wednesday and trades within a touching distance of $2,000.
USD/JPY broke below 134.00 on Tuesday as the Japanese Yen found demand as a safe haven. The pair consolidates its recent losses and holds above 133.50 early Wednesday.
Bitcoin gathered recovery momentum and rose nearly 3% on Tuesday. BTC/USD continues to stretch higher toward $28,500 mid-week. Ethereum registered small losses on Tuesday and continues to fluctuate in a tight range below $1,900 on Wednesday.