Last week, there were sharp swings in USDJPY, a decline in oil prices, and a surge in Tesla stock. What's next?
Evergreen buck goes down as oil surge backs commodity currencies
On Tuesday, the evergreen buck was suppressed by a combination of downbeat American economic data as well as gains for commodity-linked currencies, including the Australian and Canadian dollars that lent support from an extended ascend in crude prices.
Assessing the greenback’s purchasing potential versus a number of its key rivals the USD index slumped by 0.05% hitting 97.001 having dived by 0.35% yesterday, thus marking its most impressive daily tumble since March 20.
On top of the pressure from buoyant commodity-linked currencies, the evergreen buck dollar was suppressed by data disclosing that American durable goods orders went down in February and a rebound in the common currency as traders squared positions ahead of a looming ECB meeting.
The recent rebound in American yields failed to provide much lift for the evergreen buck as they are still at low levels.
As a matter of act, the 10-year Treasury yield rebounded to 2.52%, drifting further away from a 15-month minimum of 2.34% recorded at the end of March. By the way, the yield was still considerably below its recent maximum of 2.8% recorded in early March.
As for the Canadian dollar, it was nearly intact, showing C$1.3312 per dollar having soared by over 0.5% overnight.
Additionally, the Australian dollar stood still, sticking with $0.7128 having rallied by 0.3% yesterday.
Crude prices have tacked on to five-month maximums on hopes that global supplies would tighten because of fighting in Libya, American sanctions against Venezuela and Iran, and OPEC-led cuts.
Aside from that, the Norwegian kroner managed to hold its gains, demonstrating 8.543 per dollar having surged by 0.7% yesterday on higher crude.
The common currency didn’t change, ending up with $1.1265 having rallied by 0.4% on Monday.
Geopolitical factors and inflation remain the main drivers of financial markets. Let’s see how to use that in trading!
Have a look at the key financial instruments on Monday, February 28. Geopolitics is currently on all news frontlines. Western nations escalated sanctions on Russia for the invasion of Ukraine.
The US Bureau of Economic Analysis will publish Core Personal Consumption Expenditures (PCE) on May 27 at 15:30 GMT+3.
The United States will publish the Preliminary GDP on Thursday, May 26, at 15:30 GMT+3.
The Reserve Bank of New Zealand will publish a monetary policy report and make an update on the interest rate on May 25, at 05:00 GMT+3.