On political turmoil in the United States, the USD retreats from the top region, while crude oil goes up. Traders have witnessed a corrective move in the US dollar, dropping from 3-week tops in the last US session, as soon as the US PPI print came in higher than expected.
However, the major sell-off in the buck was prompted by news that a Republican candidate lost the race for the Alabama Senate, which places Trump in a difficult position to pass the tax bill.
Influenced by the news, the overnight recovery seen in the EURUSD in Asia came to a standstill near 1.17 levels, awaiting fresh impetus from the upcoming US CPIs and the FOMC meeting outcome due later today.
Following a daily open at 1.17422, EURUSD seems to be hovering above the same area and slightly below, in a range-play that appears to extend ahead of the big economic data print and the Fed meeting.
Similarly, GBPUSD remains in the negative territories ahead of the UK job report. Yesterday’s UK print showed that inflation hit 6-year highs in November, moving GBPUSD down to 2-week lows around 1.33032 (daily lows). Following a daily open at 1.33189, the cable does not seem to move too far from that area, ranging from 1.33282-3.
USDJPY recovered most of its lost ground earlier on, regaining about 30 pips, rising from weekly lows. With a daily open at 113.536, the pair hovers above the 113.413-4 handle.
EURCHF in the Spotlight
Ahead of tomorrow’s Libor Rate release and the SNB monetary policy assessment, EURCHF is next to tumble below 55-day MA. Opening daily at 1.16422, the pair now revolves around 1.16412-3, an uptrend move reinforced by the 55-day MA at 1.1600 levels.
Oil prices went up as industry data reflected a higher-than-expected drawdown in US crude combined with expectations for an extended shutdown of a key pipeline in the North Sea.
Brent crude started the day at $63.79 per barrel, gaining around 64 cents or 1% on Wednesday, trading at the moment around $64.07 per barrel.
By comparison, US crude started at $57.43 a barrel, up 42 cents or 0.7% and trades now around $57.65 a barrel.