US Dollar Falls Amid Pre-Positioning Before FOMC Rate Decision

The US Dollar traded broadly lower overnight in a move that looked to be corrective following the surge triggered by better-than-expected CPI data on Friday. The yields- and sentiment-sensitive Australian, Canadian and New Zealand Dollars outperformed as S&P 500 futures rose and Treasury bond yields edged lower, seemingly reflecting moderation in the “hawkish Fed” narrative.

A quiet economic calendar in European and US trading hours suggests Asia-session trends may find few barriers to continuation. Significant follow-through seems unlikely however, with traders probably unwilling to commit to a firm directional bias ahead of this week’s pivotal monetary policy announcements from theBank of Japan and the Federal Reserve.

Asia Session

European Session

Critical Levels