EUR/USD, GBP/USD, NZD/USD, USD/JPY – U.S. Dollar Retreats Despite Rising Treasury Yields

Key Insights

• EUR/USD rallied towards the 50 EMA as traders bet on a more hawkish ECB. 
• NZD/USD moved towards 0.6250 as traders reacted to the strong economic data from China. 
• USD/JPY settled near 136 amid profit-taking after the recent rally. 

U.S. Dollar

U.S. dollar is losing ground against a broad basket of currencies in today’s trading session.

Today, traders focused on the final reading of S&P 500 Global Manufacturing PMI and ISM Manufacturing PMI reports for February. Both reports missed analyst expectations, highlighting the challenging situation in the manufacturing sector.

The yield of 10-year Treasuries is currently trying to settle above the 4.00% level. Interestingly, this move does not provide support to the American currency.

EUR/USD

EUR/USD is currently trying to settle above the 50 EMA at 1.0660. The European currency is moving higher as traders prepare for a more hawkish policy from the ECB. RSI remains in the moderate territory, so there is plenty of room to gain additional upside momentum. If EUR/USD settles above the 50 EMA, it will move towards the resistance level at 1.0700.

GBP/USD

GBP/USD settled near the 1.2000 level as traders reacted to the better-than-expected S&P 500 Global UK Manufacturing PMI report, which showed that UK Manufacturing PMI increased from 47 in January to 49.3 in February. From a big picture point of view, GBP/USD is stuck in a wide 1.1915 – 1.2145 range.

NZD/USD

NZD/USD moved towards the 0.6250 level amid a broad rally in commodity markets. Strong economic data from China provided material support to NZD/USD.

Other commodity-related currencies have also managed to gain upside momentum in today’s trading session. AUD/USD climbed above the 0.6750 level, while USD/CAD settled near 1.3625.

USD/JPY

USD/JPY settled near the 136 level as traders continued to take profits after the recent rally. The fundamental situation remains favorable for USD/JPY bulls as the yield of 10-year Treasuries is testing the important 4.00% level.

For a look at all of today’s economic events, check out our economic calendar.