Here is what you need to know on Tuesday, August 1:
The Australian Dollar is the worst performing major currency on the first day of August following the Reserve Bank of Australia's (RBA) dovish surprise. Ahead of the ISM Manufacturing PMI and JOLTS Job Openings data from the US, the US Dollar benefits from the risk-averse market environment and gathers strength. The European economic docket will feature Unemployment Rate data for June.
The RBA announced earlier in the day that it left the policy rate unchanged at 4.1%, against the market expectation for a 25 basis points hike. In the policy statement, the RBA explained that the decision to hold rates unchanged would provide them more time to assess the impact of policy tightening to date and the economic outlook. "Some further tightening of monetary policy may be required to ensure that inflation returns to target in a reasonable timeframe, but that will depend upon the data and the evolving assessment of risks," the RBA further noted.
AUD/USD came under heavy bearish pressure following the RBA event and was last seen losing more than 1% on the day at around 0.6650.
During the Asian trading hours, the data from China revealed that the economic activity in the manufacturing sector contracted in June, with the Caixin Manufacturing PMI dropping to 49.2 from 50.5. Reflecting the souring market mood, US stock index futures trade modestly lower in the European session. Meanwhile, the 10-year US Treasury bond yield holds steady slightly below 4%.
Pressured by the renewed USD strength, EUR/USD turned south and dropped below 1.1000 in the European morning on Tuesday. HCOB will publish revisions to July Manufacturing PMI for the Eurozone and Germany.
GBP/USD closed the first day of the week virtually unchanged slightly below 1.2850. The pair stays relatively quiet early Tuesday and fluctuate at around 1.2830.
USD/JPY builds on Monday's gains and trades at its highest level in three weeks above 142.50.
Gold price stays under bearish pressure following the disappointing Chinese PMI data. At the time of press, XAU/USD was down 0.5% on the day at $1,955.
Bitcoin broke below its consolidation channel and touched its lowest level since late June below $28,500 before staging a rebound toward $29,000 in the European session. After closing the second straight day in negative territory on Monday, Ethereum extended its slide and came within a touching distance of $1,800 during the Asian trading hours. ETH/USD was last seen losing more than 1% on the day at $1,830.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: Bulls need to clear the 200-day SMA
AUD/USD treaded water around 0.6360 after once again faltering near recent tops in the 0.6440 zone, always on the back of the intense recovery in the US Dollar. In the meantime, positive headlines on the US-China trade front could help the Aussie stay in the upper end of the range for the time being.
EUR/USD strengthens above 1.1300 on gloomy Fed’s Beige Book
The EUR/USD pair edges higher to around 1.1335 during the early Asian session on Thursday. Mitigating concerns over potential tariff threats by US President Donald Trump exerts some selling pressure on the US Dollar.
Gold corrected extreme conditions, struggles around $3,300
Gold extended its decline on Wednesday, slipping below the $3,300 mark per troy ounce in response to reports from the media suggesting the Trump administration is weighing tariff reductions on Chinese goods, a news that revived hopes of easing trade tensions and reduced demand for the yellow metal as a safe-haven asset.
TRUMP meme coin rallies following announcement of President Trump's upcoming dinner with top 220 holders
Official TRUMP rallied 50% on Wednesday after the team behind the meme coin announced plans for its top 220 token holders to have a dinner with President Donald Trump in May. The announcement also included an extension of the token's initial unlock plan by an additional 90 days.
Five fundamentals for the week: Traders confront the trade war, important surveys, key Fed speech Premium
Will the US strike a trade deal with Japan? That would be positive progress. However, recent developments are not that positive, and there's only one certainty: headlines will dominate markets. Fresh US economic data is also of interest.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.