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07.02.2023 Market Report


EUR/USD is consolidating gains near 1.0750 in the early European morning. The main currency pair is capitalizing on a broad-based US Dollar retreat, in the face of sluggish Treasury bond yields and a mild risk-on market profile. ECB commentary and Powell’s speech eyed. 


GBP/USD is trading close to 1.2050, preserving gains ahead of the London Open. The upbeat market mood and renewed Brexit optimism boes well for the Pound Sterling while the US Dollar retreats with Treasury yields ahead of Fed Chair Powell’s speech. 


The USD/JPY pair has slipped below the immediate cushion of 132.50 in the Asian session. The asset is sensing selling interest after a two-day positive move as the Bank of Japan (BoJ) has confirmed a stealth intervention to provide support to the Japanese Yen. Positive commentary from US President Joe Biden on US-China relations has improved the risk appetite of the market participants.


The AUD/USD pair attracted fresh buying during the Asian session on Tuesday and snapped a three-day losing streak to a one-month low, around the 0.6855 region touched the previous day. The Australian Dollar strengthened across the board after the Reserve Bank of Australia (RBA) raised its cash rate by 25 bps to a decade-high of 3.35%. In the accompanying monetary policy statement, RBA Governor Philip Lowe said that further increases would be needed over the months ahead to ensure that inflation returns to target. It is worth mentioning that the domestic Consumer Price Index (CPI) grew at an annual pace of 7.8% in the December quarter – its fastest pace in over 30 years. This, along with a softer US Dollar, provides a goodish lift to the major.


NZD/USD seesaws around the 0.6300 round figure as bears take a breather, after a three-day south-run, during early Tuesday. In doing so, the Kiwi pair portrays a corrective bounce off the 0.6270 mark confluence amid downbeat oscillators.


USD/CAD has sensed buying interest after a drop to near 1.3400 in the early European session. The Loonie asset has recovered to near 1.3430 and is demonstrating volatility as investors are getting anxious ahead of the speech from Federal Reserve (Fed) chair Jerome Powell and Bank of Canada (BoC) Governor Tiff Macklem, scheduled for Tuesday.


USD/CHF clings to mild losses around 0.9265, after a three-day uptrend, as the US Dollar consolidates amid sluggish markets.

Adding strength to the Swiss Franc (CHF) pair’s pullback could be the cautious optimism in the market, as well as a light calendar. It’s worth mentioning that the anxiety ahead of a speech from Federal Reserve Chairman Jerome Powell and US President Joe Biden’s State of the Union (SOTU) comments also weigh on the quote of late. In doing so, the USD/CHF price retreats from the highest levels in three weeks.


Oil prices extended gains on Tuesday as markets held out for a swift recovery in Chinese demand this year, although anticipation of an address by Federal Reserve Chair Jerome Powell kept traders from making big bets.


Gold price (XAU/USD) is facing pressures in recovery extension above the critical mark of $1,875.00 in the Asian session. The precious metal has sensed selling interest as the US Dollar Index (DXY) has attempted a recovery after correcting to near 103.10.

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