What to watch for on Tuesday, July 26:
The week started in risk aversion mode, although the better performance of equities weighed on the USD since the middle of the European session. Earnings reports and hopes that the US Federal Reserve will refrain from innovating on monetary policy partly offset concerns about a global recession.
The euro was one of the worst performers as tepid European data weighed on the shared currency. The latter also suffered from persistent tensions with Russia. The Nord Stream 1 pipeline is flowing at 20% of its full capacity, and Europe will not have enough natural gas to get through the winter. The pair is trading around 1.0220, little changed for the second day in a row.
The lack of news was good news for high-yielding currencies. GBP/USD is trading around 1.2050, while AUD/USD is nearing July’s high of 0.6977. On the other hand, the USD/CAD pair drops to 1.2840.
The dollar advanced modestly against its safe-haven rivals. USD/CHF is trading at 0.9640, while USD/JPY is trading around 136.60.
The price of gold has dropped, trading around $1,717 a troy ounce. Oil rose slightly, with WTI now trading at $96.60 a barrel.
The macroeconomic calendar had little to offer until next Wednesday. The US Federal Reserve’s monetary policy decision will top the list of major events, but preliminary GDP and inflation figures for different economies will also be released.
Source: Fx Street
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