The US Dollar (USD) held its ground against other currencies early on Wednesday, maintaining marginal gains seen the previous day. Economic events on the US calendar include weekly MBA Mortgage Applications and Wholesale Inventories for March. Investors will also pay close attention to remarks from Federal Reserve (Fed) policymakers, alongside a 10-year note auction by the US Treasury later in the day.
Tuesday witnessed mixed movement in Wall Street’s primary indexes, with some hawkish comments from Minneapolis Federal Reserve President Neel Kashkari lending support to the USD in the latter half of the day. The USD Index continued its upward trend into the Asian session on Wednesday, registering nearly 0.2% gains for the day above 105.50. Meanwhile, US stock index futures traded modestly lower in European morning hours, and the benchmark 10-year US Treasury bond yield held onto slight gains while remaining below 4.5%.
In Asian trading hours, Bank of Japan (BoJ) Governor Kazuo Ueda emphasized that monetary policy aims to impact inflation rather than the exchange rate of the Japanese Yen. Despite these remarks, USD/JPY maintained its upward trajectory, trading above 155.00 after starting the week with gains.
EUR/USD closed lower on Tuesday, breaking a four-day winning streak, and remained on the back foot early Wednesday, trading below 1.0750.
GBP/USD experienced a nearly 0.5% decline on Tuesday, extending its slide below 1.2500 midweek. Market attention is now turning to the Bank of England’s monetary policy decisions scheduled for Thursday.
Gold failed to capitalize on Monday’s recovery, closing below $2,320 on Tuesday. XAU/USD traded quietly early on Wednesday, hovering near Tuesday’s closing level.
Despite a stronger US Dollar, gold prices are gaining momentum.
AUD/USD faced bearish pressure on Tuesday as the Reserve Bank of Australia (RBA) struck a cautious tone regarding further tightening, keeping policy settings unchanged. The pair continued its descent on Wednesday, trading below 0.6600.
