Market Drivers; US Session

The US dollar weakened further on Tuesday as markets reacted to US tariff announcements and potential Chinese retaliation. Here’s a market overview for Wednesday, February 5th:

US Dollar Index (DXY): The dollar index remained above 108.00 due to tariff concerns and rising US yields, failing to mount a recovery. Key US data releases today include the ADP Employment Change report, MBA Mortgage Applications, the final S&P Global Services PMI, the ISM Services PMI, and the EIA’s crude oil inventory report. Speeches from Fed members Jefferson, Barkin, Goolsbee, and Bowman are also scheduled.

EUR/USD: The euro strengthened, reversing six days of losses and approaching 1.0400. Wednesday’s European data includes the final HCOB Services PMIs for Germany and the Eurozone, Eurozone Producer Prices, and a speech by ECB’s Lane.

GBP/USD: The British pound continued its upward trend from Monday, approaching 1.2500 as the dollar weakened. The final S&P Global Services PMI for the UK is the main focus today.

USD/JPY: The yen fluctuated, recovering from Monday’s decline and reaching the 155.50 area. Japan will release the final Jibun Bank Services PMI and Average Cash Earnings.

AUD/USD: The Australian dollar rebounded from multi-year lows seen on Monday. While gains remained below 0.6260, the currency showed a significant daily increase. The Ai Group Manufacturing Index is due for release in Australia.

WTI Crude Oil: Oil prices recovered after reaching lows near $70.00 per barrel, ultimately closing the day with modest gains.

Gold: Gold prices reached a new all-time high around $2,840 per ounce, driven by the weaker dollar and continued concerns about Trump’s tariff plans.