The US dollar set off to a positive start to this week, after the bulls regained poise against most of the majors in the Asian session. The renewed broad-based US dollar strength was mainly driven by the ongoing rally in the US Treasury yields, especially the 10-year rates.
The Yen emerged the biggest loser versus the greenback while Cable was the strongest, despite mixed performance seen on the Asian equities and subdued oil prices. Both the Antipodeans traded modestly flat in tight ranges, as they look forward to fresh fundamental catalysts for fresh trading impetus.
Main topics in Asia
US 10-year treasury yield hits 4-year high, eyes break above 3 percent
The yield on the benchmark US 10-year treasury yield is trading at 2.98 percent in Asia - up two basis points and highest since March 2014.
Nikkei 225 fails to jumpstart the week, falling back towards 22,000.00
The Nikkei 225 index is slipping back below the 22,100.00 level as apprehensive traders failed to keep early Monday's momentum going.
BoJ shows signs of backpedaling on ETF purchases - Nikkei
The Nikkei Asian Review published a story over the weekend on the Bank of Japan’s (BoJ) ETF purchases, citing that the central bank's fund buys in April is set to undershoot pace for full-year target.
Japan manufacturing PMI: Export orders drop
The Nikkei Flash Japan Manufacturing Purchasing Managers’ Index (PMI) increased to 53.3 in April vs. 53.1 in March, signaling a faster pace of expansion, however, the new export orders dropped.
UK PM May might have to accept permanent membership of customs union - UK Times
According to a weekend story carried by the UK Times, the UK Prime Minister (PM) Theresa May might have to accept a permanent membership of a European customs union.
BOJ's Kuroda: Monetary police should remain accommodative until Japan hits 2 percent inflation
Monetary policy should remain accommodative until Japan hits 2 percent inflation, the Bank of Japan (BOJ) governor Haruhiko Kuroda told CNBC this weekend.
Mexican central bank Governor sees no need of extra Peso intervention
Bloomberg reports comments from Banco de México (Banxico), the Mexican central bank, Governor Alejandro Diaz de Leon is on the wires now, delivered on Sunday in an interview in Washington.
G7 ministers to take a hard stance on Russia - Reuters
According to unnamed sources, Reuters is reporting that foreign ministers in the G7 plan to take a hard stance against Russia and its recent involvement in Syria and Ukraine, but intend to keep the door open for cooperation.
Key Focus ahead
After a data-light Asian session, the EUR calendar heading into the ECB week offers event risks in the Euro area flash manufacturing and services PMI reports, followed by the German Bundesbank (Buba) monthly economic report. Meanwhile, the UK docket remains absolutely data-dry.
The NA session sees the releases of the Canadian wholesale sales data and Markit flash manufacturing and services PMI readings from the US economy, which will be followed by the US existing home sales data. Also, in focus remains the Parliamentary testimony from the Bank of Canada (BOC) Governor Poloz and Deputy Governor Wilkins at 1930 GMT for near-term trading opportunities in the Canadian dollar.
Is EUR/USD eyeing a downside break of 1.2150-1.2550 range?
The EUR/USD risks a downside break of the 1.2150-1.2550 trading range, courtesy of the widening US-German yield spread. If the preliminary PMIs (due today) print below estimates, then the investors will likely start pricing-in renewed dovishness from the ECB.
GBP/USD backed into a corner thanks to BoE Carney's smokescreen, 1.40 back on the cards
Monday is a quiet read for the Pound, with nothing of note on the calendar, and Sterling traders will be increasingly focused on GDP numbers at the end of the week.
Analysts at Westpac noted the key events ahead to start the week.
Australia’s Q1 CPI seen rising 0.5 percent - Capital Economics
Analysts at Capital Economics offer a brief preview on what to expect from Tuesday’s Australia’s CPI release for the first quarter due at 0130 GMT.
Oil prices and US Yields to dictate the pace this week
While geopolitical tensions remain bubbling under the surface, rising oil prices and higher US yields suggest investors are likely to deal with increased volatility as a broad range of political, economic and financial events unfolds
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
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.