What to watch for on Tuesday, May 24:
The dollar weakened on the first trading day of the week, amid a better market mood. US President Joe Biden said he is studying the possibility of reducing tariffs on Chinese imports, which could save up to 80 billion dollars in taxes for the country. Biden also called on OPEC to increase oil production, hoping it will help cool inflationary pressures. His comments helped keep stocks buoyant throughout the day, despite lingering concerns over inflation and growth.
The EUR/USD pair flirts with 1.0700, helped by the president of the European Central Bank, Christine Lagarde. European Central Bank President Christine Lagarde said she expects the easing program to end “very soon” in the third quarter of the year, which would leave policymakers in a position to exit negative interest rates at the end of the year. of the quarter. Furthermore, according to Lagarde, this would allow for a rate hike in July, in line with forward guidance.
GBP/USD is trading around 1.2580, also maintaining intraday gains, despite worrying Brexit news. The United Kingdom has long supported the modification of the Northern Ireland Protocol due to the barriers it creates in this country and intends to legislate against it in the coming weeks.
Commodity-linked currencies benefited from the improved tone in equities. AUD/USD is trading around 0.7100, while USD/CAD is at the 1.2780 zone.
The Swiss franc appreciated against the dollar, with the pair now hovering around 0.9660, while USD/JPY is largely unchanged on the day, trading around 127.80.
Gold made a modest gain and ended the day at $1,854 a troy ounce. Oil prices dipped slightly, with WTI trading at $110.30 a barrel.
Preliminary May S&P global PMIs for major economies will be released on Tuesday.
Source: Fx Street
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