Forex Today: US Dollar rally loses steam, eyes on BoC rate decision
|Here is what you need to know on Wednesday, October 25:
The US Dollar (USD) struggles to build on Tuesday's impressive gains early Wednesday, with the USD Index moving sideways slightly above 106.00. September New Home Sales will be featured in the US economic docket. Later in the day, the Bank of Canada (BoC) will announce monetary policy decisions and Governor Tiff Macklem will speak on the policy outlook in a press conference.
Wall Street's main indexes opened higher on Tuesday and registered strong gains. Meanwhile, the benchmark 10-year US Treasury bond yield declined for the third straight trading day before stabilizing slightly above 4.8%. Nevertheless, the upbeat S&P Global Manufacturing and Services PMI data for October provided a boost to the USD in the American session. In the European morning on Wednesday, US stock index futures trade mixed.
Inflation in Australia, as measured by the change in the Consumer Price Index (CPI), advanced to 1.2% on a quarterly basis in the third quarter, the Australian Bureau of Statistics reported in the Asian session on Wednesday. On a yearly basis, the CPI rose 5.4% in Q3. Both of these readings came in above market expectations and helped AUD/USD gather bullish momentum. At the time of press, the pair was up nearly 0.4% on the day at 0.6380.
US Dollar price this week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | CAD | AUD | JPY | NZD | CHF | |
| USD | -0.06% | -0.01% | 0.31% | -0.90% | -0.02% | -0.38% | -0.03% | |
| EUR | 0.06% | 0.06% | 0.37% | -0.79% | 0.04% | -0.32% | 0.05% | |
| GBP | 0.01% | -0.07% | 0.32% | -0.85% | 0.00% | -0.37% | 0.01% | |
| CAD | -0.31% | -0.38% | -0.35% | -1.18% | -0.33% | -0.71% | -0.34% | |
| AUD | 0.85% | 0.85% | 0.90% | 1.16% | 0.85% | 0.43% | 0.83% | |
| JPY | 0.03% | -0.05% | -0.02% | 0.32% | -0.91% | -0.39% | 0.01% | |
| NZD | 0.41% | 0.34% | 0.39% | 0.71% | -0.47% | 0.37% | 0.37% | |
| CHF | 0.01% | -0.06% | -0.01% | 0.31% | -0.88% | -0.01% | -0.39% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).
The BoC is forecast to leave its policy rate unchanged at 5%. Revised growth and inflation projections will be scrutinized by investors once the statement is released. USD/CAD climbed to a three-week-high near 1.3750 on Tuesday and went into a consolidation phase around that level early Wednesday.
EUR/USD fell sharply on Tuesday and erased all the gains it recorded on Monday. At the time of press, the pair was moving sideways at around 1.0600. IFO will release Business Climate and Current Assessment data for October later in the session.
After coming within a touching distance of 1.2300 early Tuesday, GBP/USD turned south and closed the day deep in negative territory below 1.2200. In the European morning, the pair seems to have stabilized above 1.2150.
USD/JPY failed to make a decisive move in either direction and fluctuated in a tight channel below 150.00 for the sixth consecutive trading day on Tuesday. Early Wednesday, the pair extends its sideways grind at around 149.80.
Despite broad USD strength, XAU/USD managed to hold its ground, supported by retreating US yields on Tuesday. Gold was trading up and down in a narrow band slightly above $1,972 at the time of press.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.