The euro rose to a new four-year high on Tuesday amid steady dollar sales and a steeper Treasury yield curve ahead of an expected Fed rate cut on Wednesday.
White House economic aide Stephen Miran will to the Federal Reserve Board after being confirmed by the Senate.
President Donald Trumpreporters as he departed for a trip to Britain that the Fed needs to be independent and that there is an between the U.S. and China on TikTok.
Treasury Secretary Scott Bessent he had a productive meeting with James Bullard -- former St. Louis Fed president -- while searching for a new Fed chair, expects a TikTok deal and emphasized easing inflation and the need to balance growth with Fed policy.
Treasury yields were lower even after U.S. retail sales beat estimates.
The dollar index slid below its 21-day Bollinger Band and is 0.3% away from its 2025 low as several currencies including the offshore yuan reached calendar-year highs.
The prospect of crypto gaining ground may have contributed to dollar weakness after Bank of America about stablecoins and Swiss banks' first of public blockchain.
Turkey's central bank also buying foreign exchange.
EUR/USD climbed past its July peak after New York expiries, extending gains to 1.1879 on sustained euro demand. Further upside toward 1.20 could be fueled by Wednesday’s euro zone inflation data and a potential Fed rate cut.
GBP/USD surged to a 10-week high, breaking out of a narrow Bollinger Band range ahead of Thursday’s Bank of England meeting and the upcoming U.K. CPI release. With bullish momentum building, cable targets its year-to-date peak of 1.3787.
USD/JPY slid beneath its Ichimoku cloud for just the second time since early July, marking a fresh September low as speculative selling intensified. The pair could test its August low of 146.22 and 100-day moving average at 146.16 on further losses.
Treasury yields were down as much as 2 basis points as the curve steepened. The 2s-10s curve was up about 2 basis points to +51.4bp.
The S&P 500 was down marginally after paring a steeper drop.
Oil gained over 2% on Russian supply worries following Ukraine drone attacks.
Gold rose 0.29% and hit a record high during the session while copper slid 0.54%
Heading toward the close: EUR/USD +0.90%, USD/JPY -0.69%, GBP/USD +0.44%, AUD/USD +0.24%, DXY -0.68%, EUR/JPY +0.21%, GBP/JPY -0.21%, AUD/JPY -0.45%.
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(Editing by Burton Frierson
Reporting by Robert Fullem)
((robert.fullem@thomsonreuters.com [robert.fullem@thomsonreuters.com];))
