Forex Today: US Dollar consolidates losses ahead of mid-tier data


Here is what you need to know on Wednesday, February 7:

The US Dollar (USD) struggles to gain traction early Wednesday, with the USD Index (DXY) holding steady slightly above 104.00 after snapping a two-day winning streak on Tuesday. Goods Trade Balance for December will be featured in the US economic docket and the US Treasury will hold a 10-year note auction later in the day. Several Federal Reserve policymakers are scheduled to speak during the American trading hours as well.

The USD weakened against its rivals on Tuesday amid retreating T-bond yields and a positive shift seen in risk mood. In the European morning, US stock index futures trade virtually unchanged and the 10-year yield fluctuates in a tight channel at around 4.1%. 

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 weakest against the New Zealand Dollar.

  USD EUR GBP CAD AUD JPY NZD CHF
USD   0.09% 0.02% 0.07% -0.48% -0.44% -0.82% 0.25%
EUR -0.09%   -0.07% -0.02% -0.56% -0.54% -0.90% 0.16%
GBP -0.02% 0.07%   0.05% -0.49% -0.47% -0.83% 0.23%
CAD -0.07% 0.02% -0.05%   -0.54% -0.52% -0.88% 0.15%
AUD 0.45% 0.57% 0.48% 0.53%   0.02% -0.34% 0.71%
JPY 0.43% 0.53% 0.43% 0.51% -0.02%   -0.36% 0.69%
NZD 0.80% 0.91% 0.83% 0.88% 0.34% 0.36%   1.05%
CHF -0.27% -0.16% -0.22% -0.20% -0.71% -0.71% -1.08%  

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).

 

During the Asian trading hours, the data from New Zealand showed that the Unemployment Rate ticked up to 4% in the fourth quarter from 3.9% in the third quarter. This reading came in below the market expectation of 4.2%. In the same period, the Labor Cost Index was up 3.9% on a yearly basis. NZD/USD edged higher after the labor market data and was last seen trading modestly higher on the day above 0.6100.

The Leading Economic Index in Japan improved to 110 in December's flash estimate from 108.1, while the Coincident Index rose to 116.2 from 114.6. After falling 0.5% on Tuesday, USD/JPY showed no reaction to these figures and was last seen moving sideways slightly below 148.00.

USD/CAD turned south and closed below 1.3500 on Tuesday. The pair stays under modest bearish pressure early Wednesday. Bank of Canada (BoC) Governor Tiff Macklem reaffirmed that the BoC is done with rate hikes, stating that 5% is largely viewed as the level the BoC thinks is necessary to continue draining momentum out of inflation. He added that the policy discussion is shifting from whether or not policy is restrictive enough to how long it should remain restrictive.

EUR/USD extended its recovery toward 1.0800 early Wednesday after posting marginal gains on Tuesday. The data from Germany showed that Industrial Production contracted by 1.6% on a monthly basis in December.

GBP/USD trades in positive territory above 1.2600 in the European morning. On Tuesday, the pair rose 0.5% and erased a large portion of Monday's losses.

Gold benefited from falling US yields and rose toward $2,040 on Tuesday. Early Wednesday, XAU/USD moves up and down in a narrow band near $2,035.

(This article was corrected at 07:35 GMT to say that the Leading Economic Index in Japan improved to 110 in December, not 100.)

Share: Feed news

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


Recommended content

Editors’ Picks

EUR/USD stays near 1.0400 in thin holiday trading

EUR/USD stays near 1.0400 in thin holiday trading

EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.

EUR/USD News
GBP/USD struggles to find direction, holds steady near 1.2550

GBP/USD struggles to find direction, holds steady near 1.2550

GBP/USD consolidates in a range at around 1.2550 on Tuesday after closing in negative territory on Monday. The US Dollar preserves its strength and makes it difficult for the pair to gain traction as trading conditions thin out on Christmas Eve.

GBP/USD News
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.

Gold News
IRS says crypto staking should be taxed in response to lawsuit

IRS says crypto staking should be taxed in response to lawsuit

In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.

Read more
2025 outlook: What is next for developed economies and currencies?

2025 outlook: What is next for developed economies and currencies?

As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.

Read more
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures