US Dollar Stabilizes After Recent Losses, Attention Turns to Upcoming US Economic Data

The US Dollar is experiencing challenges in maintaining its strength against major global currencies in the early hours of Tuesday. This situation follows the US Dollar Index’s closure in negative territory on Monday, with it continuing to struggle, staying below the 104.00 mark. Investors are currently focusing their attention on the upcoming release of key US economic data, including January’s Durable Goods Orders and the Conference Board’s Consumer Confidence Index for February. Additionally, the Housing Price Index for December and the Richmond and Dallas Fed Manufacturing Indexes for February will also be part of the US economic docket.

On Monday, there was a modest recovery in the benchmark 10-year US Treasury bond yield, while major equity indexes in the US recorded slight losses. Early Tuesday, the 10-year yield is maintaining a steady position just below 4.3%, and US stock index futures are trading with marginal decreases. Durable Goods Orders are anticipated to show a decline of 4.8% in January, following a period of no change in December. Federal Reserve Vice Chair for Supervision Michael Barr is scheduled to deliver a speech later in the day, discussing the risks associated with counterfeit credit.

In the meantime, during Asian trading hours, data from Japan indicated that the National Consumer Price Index (CPI) experienced a year-on-year increase of 2.2% in January, a decrease from December’s 2.6% rise. However, the USD/JPY pair largely overlooked this data, continuing its stable trend around the 105.50 level.

The Japanese Yen has found support due to renewed speculation about a policy shift from the Bank of Japan (BoJ), with US data becoming the center of attention. The EUR/USD pair saw a 0.3% gain, marking its highest daily closure since early February. It appears to have found a stable position around 1.0850 in the European morning on Tuesday. The European Central Bank (ECB) is set to release data on Private Loans and the M3 Money Supply for January.

The Australian Dollar (AUD/USD) witnessed a near 0.4% decline, ending its 8-day streak of gains on Monday. After hitting a weekly low at 0.6525 during the Asian session, the pair rebounded and was last observed trading slightly higher at around 0.6550.

The British Pound (GBP/USD) continued its upward trend, reaching 1.2700 before experiencing a correction on Monday. As of Tuesday morning in Europe, the pair is trading in a narrow range above 1.2650. Dave Ramsden, the Bank of England (BoE) Deputy Governor for Markets and Banking, is scheduled to speak later in the day.

Gold exhibited a sideways movement within a tight range around $2,030 for most of Monday, before recording a minor loss. Early Tuesday, XAU/USD remains steady, slightly above the $2,030 mark, indicating a period of calm in the gold market.