US Dollar quiets down following Wednesday’s rebound

Markets stay relatively quiet early Thursday and the US Dollar Index moves up and down in a tight range below 102.00 following Wednesday’s rebound. The US economic docket will feature weekly Initial Jobless Claims and Challenger Job Cuts data. St. Louis Federal Reserve President James Bullard will deliver a speech on the economy and monetary policy. Statistics Canada will release the March jobs report as well. Bond markets in the US will close early ahead of the Easter holiday on Friday and the trading action is likely to turn subdued later in the day.

Despite disappointing macroeconomic data releases from the US, the negative shift witnessed in risk mood amid growing concerns over an economic slowdown helped the US Dollar stay resilient against its rivals. In the early European session on Thursday, US stock index futures trade mixed. Meanwhile, the 10-year US Treasury bond yield stays in negative territory below 3.3%.

During the Asian trading hours, the data from China revealed that Caixin Services PMI improved to 57.8 in March from 55 in February, surpassing the market expectation of 54. This data, however, failed to trigger a noticeable market reaction.

EUR/USD turned south on renewed USD strength in the second half of the day on Wednesday and erased all the gains it recorded on Tuesday. Early Thursday, the pair fluctuates in a narrow channel slightly above 1.0900.

GBP/USD closed in negative territory after having met resistance at 1.2500 on Wednesday. The pair clings to modest recovery gains on Thursday but stays below 1.2500. The data from the UK showed that Halifax House Prices rose by 0.8% on a monthly basis in March, compared to maker expectation for a decrease of 0.3%.

The Unemployment Rate in Canada is forecast to tick up to 5.1% in March. Net Change in Employment is expected to arrive at +12K following February’s 21.8K increase. Ahead of this key data, USD/CAD holds steady slightly below 1.3500.

Despite the USD’s upbeat performance, USD/JPY closed in the red for the third straight day on Wednesday, pressured by falling US T-bond yields. At the time of press, the pair was flat on the day slightly below 131.50. In the early Asian session on Friday, Leading Economic Index and Coincident Index data for February will be featured in the Japanese economic docket.

Gold price lost its traction on Wednesday but closed the day virtually unchanged supported by retreating yields. XAU/USD stays in a consolidation phase below $2,020 on Thursday.

Bitcoin struggled to find direction and closed flat on Wednesday. BTC/USD continues to move sideways at around $28,000 on Thursday. Ethereum extended its rally and touched its highest level since August near $1,950 before staging a technical correction. As of writing, ETH/USD was down more than 1% on the day at $1,880.

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