EUR/USD
EUR/USD edges lower after four days of gains, trading around 1.1560 during the Asian hours on Tuesday. The pair holds losses as the US Dollar (USD) gains support amid growing hopes that the US government shutdown resolution is nearing. The US Senate passed a funding bill in a 60–40 vote, effectively ending the 41-day shutdown, with eight Democrats joining Republicans to advance the measure, which now moves to the House for approval.
GBP/USD
The UK jobs report may reinforce the expectations that the Bank of England (BoE) will cut interest rates at its December meeting, weighing on the Pound Sterling (GBP) and the GBP/USD pair. Traders will likely observe the preliminary Gross Domestic Product (GDP) quarter-over-quarter (QoQ) for the third quarter and September’s production output data due on Thursday. BoE Governor Andrew Bailey indicated that rate reductions are on the horizon, with economists now anticipating a pre-Christmas cut. The central bank emphasized, however, that future easing will depend on how the inflation outlook evolves.
USD/JPY
The USD/JPY pair attracts some buyers to near 154.10 during the early Asian session on Tuesday. The US Dollar (USD) strengthens against the Japanese Yen (JPY) as hopes grow for a potential deal to end the 41-day US federal government shutdown in the coming days. The US ADP Employment Change Weekly is due later on Tuesday.
AUD/USD
AUD/USD appreciates toward 0.6520 on Monday at the time of writing, up 0.40% for the day. The Australian Dollar (AUD) gains momentum after Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser argued in favor of maintaining a restrictive monetary policy stance to reach the inflation target. Speaking at a UBS conference in Sydney, Hauser stated that policy must remain restrictive enough to “close the output gap,” adding that the Australian economy continues to “run above its potential,” leaving little room for near-term rate cuts.
NZD/USD
The NZD/USD pair loses traction near 0.5640 during the Asian trading hours on Tuesday. The New Zealand Dollar (NZD) softens against the US Dollar (USD) after the Reserve Bank of New Zealand’s (RBNZ) latest monetary conditions survey. Traders will keep an eye on the US ADP Employment Change weekly report later on Tuesday.
USD/CAD
USD/CAD gains ground after two days of losses, trading around 1.4030 during the Asian hours on Tuesday. The pair rises as the US Dollar (USD) gains support amid progress in the US Senate toward passing a deal to reopen the government.
USD/CHF
The USD/CHF pair edges lower to near 0.8045 during the late Asian trading session on Tuesday. The Swiss Franc pair faces slight selling pressure as the Swiss Franc (CHF) outperforms its peers on hopes that the United States (US) and Switzerland will reach a trade deal soon.
CRUDE OIL
Oil prices dipped in Asian trade on Tuesday as oversupply concerns outweighed uncertainty over the impact of U.S. sanctions on Russian oil majors Rosneft and Lukoil and optimism over progress toward reopening the U.S. government.
Gold (XAU/USD) retreats slightly from the vicinity of the $4,150 supply zone, or a nearly three-week high touched during the Asian session on Tuesday, as a positive development towards reopening the US government undermines safe-haven demand. The safe-haven commodity, however, might continue to draw support from worries about the potential economic fallout from the longest-ever US government shutdown. This, along with expectations for another rate cut by the US Federal Reserve (Fed) in December, could act as a tailwind for the non-yielding yellow metal.
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