The dollar is broadly lower today, losing ground against the other major currencies except vs. the TWD (+0.03%) and CHF (+0.08%). Primary dollar losses are -0.60% vs. AUD, -0.53% vs. MXN, -0.44% vs. NZD, -0.43% vs. SEK & JPY, -0.25% vs. EUR -0.21% vs. CAD, and -0.12%vs. GBP.
The dollar index is -0.27% (its biggest move in weeks) and testing support at 103.50.
USD/MXN is gaining downside momentum after Monday’s close below 17.000. Next support at 16.8000 is quickly approaching, followed by 16.6200.
Fed Chairman Powell began his testimony to Congress, beginning with the House panel today. Key points from Powell’s prepared statement:
- We believe that our policy rate is likely at its peak for this tightening cycle.
- If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year.
- The Committee does not expect that it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent.
U.S. Treasury yields are lower in all tenors (in sync with the dollar), with the mid-tenors seeing the biggest declines.
The Bank of Canada will announce its rate decision today and is expected to leave unchanged at 5%.
Global equity indexes are universally higher, the Nasdaq 100 leading the way with a gain of 0.924%.
Gold is trading at a record high today at $2,142.30, +0.75%.
