US dollar
The market mood is somewhat risk-averse, with stocks on the back foot while the dollar and the yen advance. Oil stands out with gains amid Saudi output cuts. The most recent deterioration in the mood has been attributed to China’s ban on imports from four Australian producers. The move is seen as a retaliation for Australia’s call for an investigation into the origins of COVID-19.
US President Donald Trump has continued urging a return to normal while touting tests and a flattening curve. However, disease data remains stubbornly high and even spiking in several areas, according to the internal data held by the administration.
GBP/USD is on the back foot, and that can partly be attributed to Prime Minister Boris Johnson’s confusing messages about getting back to work. USD/JPY takes a U-turn from seven-week highs and refreshes low below 107.50 amid broad risk-aversion. EUR/USD last sat at $1.0810.
Oil prices have been holding their ground despite the moderate risk-off mood. Saudi Arabia announced it would further reduce production, going beyond the OPEC+ agreement, with fears of filling storages remain significant. Gold price is finding it difficult to maintain its upward moment as investors seems to favour the dollar over gold.
While updates concerning Brexit, coronavirus (COVID-19) and US-China trade tussle can keep driving near-term moves, US inflation data will also be the key to watch during the early North American session at 12:30 GMT.
This along with scheduled speeches by influential FOMC members will influence the USD demand and could possibly provide some meaningful opportunities. This comes ahead of the Fed Chair Jerome Powell’s scheduled speech about the current economic issues on Wednesday.