Mood improves ahead of ECB-speak, US data

There is a positive shift in risk mood early Tuesday as investors, with the US stock index futures trading in positive territory following the sharp decline seen in Wall Street‘s main indexes on Monday. European Central Bank (ECB) President Christine Lagarde will deliver an introductory speech at the 2023 ECB Forum on Central Banking and several ECB policymakers will speak on policy and inflation later in the day. The US economic docket will feature Durable Goods Orders and New Home Sales for May and CB Consumer Confidence Index for June.

During the Asian trading hours, Chinese Premier Li Qiang said that China was still on track to reach its annual growth target of around 5.0% for the year. “China will introduce more pragmatic measures to expand domestic demand and stimulate market vitality,” Li added. Shanghai Composite and Hang Seng indexes both gained more than 1% on Tuesday. Reflecting the negative impact of improving risk mood on the US Dollar’s (USD) performance, the US Dollar Index (DXY) declines toward 102.50.

EUR/USD closed flat near 1.0900 on Monday but regained its traction early Tuesday. The pair was last seen rising toward 1.0950.

Supported by the renewed USD weakness, GBP/USD edges higher toward 1.2750 in the European morning. Bank of England MPC Member Silvana Tenreyro will present a paper titled “Monetary policy in the face of supply shocks: the role of inflation expectations” at the ECB event.

USD/CAD stays on the back foot and trades at its lowest level since September below 1.3130. Statistics Canada will publish Consumer Price Index (CPI) data for May in the early NA session.

AUD/USD gathered bullish momentum in the Asian trading hours and climbed above 0.6700, fuelled by China optimism.

USD/JPY continues to move sideways at around 143.50 as the Japanese Yen finds it difficult to find demand in the risk-positive market environment. Japanese Finance Minister Shunichi Suzuki reiterated on Tuesday that they “will respond appropriately if FX moves become excessive.”

Gold price ended the day virtually unchanged on Monday, with the modest rebound witnessed in the US Treasury bond yield limiting XAU/USD’s upside. The pair clings to small recovery gains at around $1,930 early Tuesday.

Bitcoin stays in its tight consolidation channel above $30,000 for the fourth straight day on Tuesday. Following Monday’s 2% decline, Ethereum recovers toward $1,900 in the European morning.