EUR/USD, GBP/USD, USD/CAD, AUD/USD – U.S. Dollar Index Remains Stuck Near 102
Key Insights
- EUR/USD is trying to settle above the 1.0900 level.
- GBP/USD rebounds after yesterday’s pullback.
- USD/CAD gains ground after BoC Interest Rate Decision.
U.S. Dollar (DXY)
U.S. Dollar Index remains stuck near the 102 level as traders wait for catalysts. There are no important economic reports scheduled to be released in the U.S. today, so traders will stay focused on general market sentiment.
EUR/USD
EUR/USD has recently made an attempt to settle above the 1.0900 level. Traders bet that ECB will be forced to raise rates aggressively in order to fight inflation. At the same time, the Fed is expected to slow the pace of rate hikes.
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The difference between the expected Fed policy and ECB policy is bullish for the European currency. From the technical point of view, RSI is close to the overbought territory, but there is enough room to gain additional upside momentum.
GBP/USD
GBP/USD rebounds after yesterday’s pullback. Currently, GBP/USD is trying to settles above the 1.2350 level.
Today, traders focused on UK Producer Prices reports, which showed that prices softened by more than forecast in December. The reports did not put material pressure on GBP/USD.
USD/CAD
USD/CAD settled back above the 1.3400 level after the BoC Interest Rate Decision. BoC raised the interest rate by 25 bps and signaled that it could be the last hike. The dovish signal put pressure on the Canadian dollar, although it should be noted that there is no panic.
Meanwhile, AUD/USD made an attempt to settle above the 0.7100 level as traders reacted to the higher-than-expected inflation data from Australia. New Zealand inflation reports also exceeded analyst estimates, but NZD/USD found itself under pressure and pulled back towards 0.6450.
USD/JPY
USD/JPY settled below the 130 level as traders bet that BoJ will be ultimately forced to abandon its ultra-dovish policy. From a big picture point of view, USD/JPY has recently failed to settle above the 20 EMA, and the current downside trend remains intact.
For a look at all of today’s economic events, check out our economic calendar.