ForexLive European FX news wrap: Dollar eases slightly ahead of Wall Street return

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ForexLive European FX news wrap: Dollar eases slightly ahead of Wall Street return

Headlines:

• Dollar down slightly in European morning trade
• BOE's Bailey: We don't need inflation to be back at target before cutting rates
• BOE's Bailey: I cannot say when or how much rates will be cut
• BOE's Broadbent: I don't agree that all the evidence points in the direction of rate cuts
• Goldman Sachs now expects the BOE to begin rate cuts in June, as opposed to May previously
• Eurozone wages data ease slightly in Q4 2023
• Eurozone December current account balance €31.9 billion vs €24.6 billion prior
• Switzerland January trade balance CHF 4.74 billion vs CHF 1.25 billion
• Japan says it is always communicating with other countries in case for FX intervention

Markets:

• AUD and NZD lead, USD lags on the day
• European equities mostly higher; S&P 500 futures down 0.3%
• US 10-year yields down 2.2 bps to 4.273%
• Gold up 0.5% to $2,026.73
• WTI crude down 0.9% to $77.45
• Bitcoin up 0.6% to $52,213

It was a quietly cautious session as we await the return of Wall Street after the long weekend in the US.

The dollar was dragged lower though alongside bond yields, with 10-year Treasury yields slipping back to 4.27%. That saw USD/JPY retreat from around 150.40 in Asia to 150.07 currently.

Meanwhile, the dollar struggled elsewhere with EUR/USD rising from 1.0770 to 1.0800 and the commodity currencies also gained strongly against the greenback. AUD/USD is seen up 0.4% to 0.6565 while NZD/USD is also up 0.4% to 0.6175 on the day.

Besides that, GBP/USD was more stable around 1.2600 as BOE policymakers start to steer the conversation towards rate cuts in their latest remarks today.

There was also Eurozone Q4 2023 wages data but that didn't really faze the euro as traders and the ECB are waiting on the Q1 2024 numbers with more intent instead. That will not be out until some time in May.

Risk tones are less enthused with S&P 500 futures seen down 0.3% currently. But as US traders look set to enter the fray, we'll see how that will contribute to the flows so far today.

                This article was written by Justin Low at www.forexlive.com.

Source: ForexLive European FX news wrap: Dollar eases slightly ahead of Wall Street return

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