Market Drivers; US Session, March 25

The USD Index (DXY) declined from recent highs during the week’s bearish opening, although it continued to trade over the 104.00 mark. The Conference Board’s tracking of US Consumer Confidence, together with the FHFA’s House Price Index and Durable Goods Orders, will be the main topics of interest on March 26.

Forex Developments

With respectable gains, the EUR/USD pair returned from the recent lows in the vicinity of 1.0800. On March 26, the GfK Consumer Confidence Index for Germany will be the main focus.

On Monday, GBP/USD broke above the 1.2600 barrier, continuing its recent trend of daily declines and trailing its rivals with a higher risk profile. The GDP numbers on March 28 will be the next important item on the UK agenda.

The USD/JPY pair began the week fluctuating in the 151.50 area, and market players continued to be cautious about possible FX intervention as the pair moved closer to the crucial 152.00 barrier.

Risk Appetite Factor

At the start of a week that will be dominated by expectations surrounding the publication of US PCE, price movement around the US dollar remained muted due to the recovery of attitude towards the risk-associated universe.

The AUD/USD gained momentum and approached the boundaries of the important 200-day SMA in the mid-0.6500s as a result of the improvement in appetite for the risk complex. March 26 is the deadline for both Westpac’s Consumer Confidence Index and RBA Governor Connolly’s speech.

Key Commodities

WTI prices began the week with some equilibrium and a recovery of the region above $82.00 per barrel due to more supply concerns. After two straight days of losses, gold prices managed to slightly increase due to renewed weakness in the US dollar. In a similar vein, silver recorded modest increases after the significant sell-off that occurred late last week.

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