The US Dollar (USD) saw a correction lower to begin the week, driven by a lack of high-tier economic data. Financial markets remain volatile as investors wait for key economic events, including the Bank of England’s (BoE) Monetary Policy Hearings and Canada’s Consumer Price Index (CPI) data. Later in the day, the US economic calendar will feature the release of Building Permits and Housing Starts figures for October.
After an impressive rally last week, the USD Index reversed direction on Monday, closing in negative territory. As of Tuesday morning in Europe, the index is fluctuating in a narrow range above 106.00. Meanwhile, US stock index futures are marginally higher following a mixed close on Wall Street on Monday.
Reserve Bank of Australia’s (RBA) November Meeting Minutes Released
In the Asian session on Tuesday, the Reserve Bank of Australia (RBA) released the minutes from its November monetary policy meeting. The central bank emphasized that future rate changes are uncertain, noting the need for multiple strong quarterly inflation reports before considering a rate cut. Following a 0.7% gain on Monday, the AUD/USD continues to trend higher, trading above the 0.6500 level.
USD/CAD Faces Pressure as Crude Oil Prices Rise
The USD/CAD pair faced significant downward pressure on Monday, losing over 0.5% due to broad-based USD weakness and rising crude oil prices. In the European morning, the pair is consolidating slightly above the 1.4000 mark. Canadian annual inflation, as measured by the CPI, is forecast to rise to 1.9% in October, up from 1.6% in September.
Japan’s Finance Minister Monitors Forex Moves
Japan’s Finance Minister, Katsunobu Kato, reiterated concerns on Tuesday, stating that they are closely monitoring foreign exchange (FX) moves with urgency and will take appropriate action to curb excessive fluctuations. USD/JPY closed slightly higher on Monday but retreated to around 154.50 on Tuesday morning.
UK Economy Under Scrutiny as BoE Holds Monetary Policy Hearings
Bank of England (BoE) Governor Andrew Bailey and other Monetary Policy Committee members will address the Treasury Committee at 10:15 GMT on Tuesday. The GBP/USD reversed a six-day losing streak on Monday but lost momentum before hitting the 1.2700 mark.
EUR/USD Shows Consolidation After Strong Monday Gains
EUR/USD gained more than 0.5% on Monday before consolidating around the 1.0600 level early Tuesday. Eurostat will release revised October Harmonized Index of Consumer Prices (HICP) data during the European session.
Gold Prices Surge Amid Market Uncertainty
Gold saw strong bullish momentum on Monday, rising nearly 2%. XAU/USD continues to climb higher in the European morning, now trading above $2,620.
