Here is everything you should know about Forex for Tuesday, May 7:
In Forex Market Australian Dollar (AUD) fell against its rivals early Tuesday as investors assessed the Reserve Bank of Australia’s (RBA) monetary policy decisions and Governor Michele Bullock’s comments. Eurostat will publish Retail Sales for March, and the US economic calendar will include Economic Optimism and Consumer Credit Change data. Meanwhile, investors will continue to closely monitor comments from central bank officials.
The RBA held the policy rate unchanged at 4.35%, as expected, following the May policy meeting. In its policy statement, the RBA stated that inflation has continued to decline, but at a slower rate than envisaged. In the post-meeting press conference, RBA Governor Bullock stated that current interest rates should bring inflation back to goal, and that she does not believe it will be necessary to tighten policy further. AUD/USD is under negative pressure in the early European morning, with the pair shedding 0.3% on the day near 0.6600.
Bullock Speech: RBA Governor discusses policy prospects after keeping interest rates.
The US Dollar (USD) Index completed the first trading day of the week practically unchanged, as the increasing risk sentiment made it difficult for the USD to gain traction. Early Tuesday, US stock index futures were neutral, while the benchmark 10-year US Treasury bond rate remained below 4.5%.
Market movement in pairs
In Forex Market EURUSD moves in a tight channel. Following minor advances on Monday, the European session on Tuesday saw a slight increase above 1.0750.
The GBPUSD pair closed in positive territory for the fourth consecutive day on Monday, but struggled to maintain its bullish momentum throughout Asian trading hours on Tuesday. The pair was last seen trading near 1.2550, down little for the day.
USDJPY rose more than 0.5% on Monday and recovered to around 154.50 early Tuesday. Masato Kanda, Japan’s top currency ambassador, reaffirmed on Tuesday that the Japanese government may take steps to address excessive market volatility, but declined to comment on foreign exchange rates.
Gold gained over 1% every day as US yields fell and international concerns rose. XAUUSD remains relatively quiet. Around $2,320 in the European morning.
