The North American market experienced a decline in the dollar on Tuesday, yet there was minimal subsequent selling activity. Yesterday, the dollar was in demand in North America, and rather than countering this trend, European operators, more so than those in the Asia Pacific, have contributed to the greenback’s continued appreciation. The relatively hawkish FOMC minutes led the US two-year yield to recover to session highs yesterday and continue to rise slightly today. However, at approximately 4.47%, the yield continues to fall short of last week’s peak (~4.51%) in anticipation of today’s data. Two additional significant factors must be taken into account. First, despite the ongoing discussions, the market remains apprehensive regarding a potential US military action against Iran. March WTI has increased by 1.7% today, following a notable 4.6% rise yesterday. It is approaching the peak observed last month, approximately $66.50. Secondly, tomorrow marks a pivotal decision day for the US Supreme Court. The announcement does not specify which cases have been resolved; however, there exists the possibility of a ruling regarding the president’s invocation of emergency powers in relation to tariffs.

Yesterday, the euro fluctuated slightly around Tuesday’s trading range and concluded below its lowest point. The bearish outside down day resulted in a decline of the euro to nearly $1.1780 yesterday. The currency failed to regain its position above $1.1810 and subsequently declined to approximately $1.1775 during the late European morning session. The recent low established earlier this month was approximately $1.1765, and a breach of this level could trigger an additional cent decrease. The dollar appreciated nearly 1% relative to the yen yesterday, marking its most significant increase of the month. It is noteworthy that it experienced a decline each day last week, contradicting forecasts for a weaker yen following the remarkable LDP victory and the ensuing rally in JGBs. The JPY154.90 area was approached in North America. The gains were extended to nearly JPY155.35 before sellers emerged, driving the greenback down to approximately JPY154.60 during the European morning session. The intraday momentum indicators appear to be overextended, indicating that there is limited downside potential in the early North American activity.

Sterling predominantly oscillated within Tuesday’s 1 1/3-cent range yesterday, yet it exhibited significant trading volume. The value declined to nearly $1.3465 today, as it struggled to surpass $1.3520. The intraday momentum indicators appear to be extended, indicating a potential rebound in the early North American trading session. The subsequent zone of support is identified within the $1.3440-60 range. The Canadian dollar appears to be in a precarious position. It recorded its lowest settlement in almost two weeks. The greenback advanced to CAD1.37 yesterday, benefiting from strong demand in the North American afternoon. It rose to CAD1.3705 today but is currently consolidating within the CAD1.3670-CAD1.3690 range in Europe. The greenback must surpass the CAD1.3725 level to indicate a potential advance towards CAD1.3760-CAD1.3800.

The Australian dollar exhibited subdued and tranquil trading yesterday. Throughout the session, it remained largely within a narrow range, hovering approximately one-third of a cent above $0.7050, before declining to $0.7035 during the North American afternoon. This was supported by a strong jobs report released today. Nevertheless, the market exhibited hesitance in elevating the Aussie beyond $0.7080. Meanwhile, a breach of the 0.6990-0.7000 range would indicate a definitive correction rather than mere consolidation, suggesting a downside potential of 1-1.5 cents.