Forex Today: Dollar down but not yet defeated

Valeria Bednarik FXStreet

What you need to take care of on Friday, June 3:

The greenback changed course on Thursday and gave up all of its Wednesday gains and more. Easing government bond yields and tepid US employment-related figures put pressure on the American currency, later weighed by the positive tone of Wall Street.

Concerns related to economic growth and inflation remain the same, moreover after the EU Producer Price Index hit 37.2% in April, above the market’s expectations. Government bonds were up, with yields giving up some of their recent gains.

US indexes edged higher, even despite comments from Federal Reserve Vice-Chair Lael Brainard said that the central bank would hardly pause its current rate-hiking cycle amid record inflation levels. Cleveland Loretta Mester said that inflation has not yet peaked and that it’s too early to discuss a potential pause in the tightening path.

The EUR/USD pair trades near 1.0750, and not far from its weekly high at 1.0786. The GBP/USD pair is also up, trading at around 1.2560. Commodity-linked currencies soared. The AUD/USD pair is now hovering at around 0.7250, while USD/CAD trades at around 1.2570.

Gold soared, trading at its highest in near a month. It is currently changing hands at around $1,870 a troy ounce. Crude oil prices were also up, with WTI trading at $117.10 a barrel. The OPEC+ announce it would increase production by 648,000 barrels per day in July and August amid disruptions caused by Russia’s invasion of Ukraine.

The focus is now on the US Nonfarm Payrolls report.

Like this article? Help us with some feedback by answering this survey:

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD extends its optimism past 1.1900

EUR/USD retains a firm underlying bid, surpassing the 1.1900 mark as the NA session draws to a close on Monday. The pair’s persistent uptrend comes as the US Dollar remains on the defensive, with traders staying cautious ahead of upcoming US NFP prints and CPI data.

GBP/USD hits three-day peaks, targets 1.3700

GBP/USD is clocking decent gains at the start of the week, advancing to three-day highs near 1.3670 and building on Friday’s solid performance. The better tone in the British Pound comes on the back of the intense sekk-off in the Greenback and despite re-emerging signs of a fresh government crisis in the UK.

Gold picks up pace, retargets $5,100

Gold gathers fresh steam, challenging daily highs en route to the $5,100 mark per troy ounce in the latter part of Monday’s session. The precious metal finds support from fresh signs of continued buying by the PBoC, while expectations that the Fed could lean more dovish also collaborate with the uptick.

XRP struggles around $1.40 despite institutional inflows

Ripple (XRP) is extending its intraday decline to around $1.40 at the time of writing on Monday amid growing pressure from the retail market and risk-off sentiment that continues to keep investors on the sidelines.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.