The dollar is making up for lost ground in trading yesterday, as it is pushing solid gains ahead of the European session today. EUR/USD is down 0.4% now to 1.0688 while GBP/USD is down 0.3% to 1.2380 on the day. However, the more apparent gains for the dollar are coming against the commodity currencies.
Amid a turnaround in risk sentiment late yesterday, we are seeing the dour mood persist today and that is weighing especially on the likes of the aussie and kiwi. Both currencies are now down to their lowest levels since November against the dollar:
AUD/USD daily chart
NZD/USD daily chart
The pressure is certainly on and a firm break of 0.6500 in AUD/USD and 0.6000 in NZD/USD is likely to set off the next downside leg for both pairs in the short-term.
All that being said, the dollar isn’t the best performer in trading today. That mantle belongs to the yen as it continues to track higher amid a further drop in bond yields. Treasury yields are down another 4 bps today to 3.655% and that is seeing USD/JPY get dragged down by 0.3% to 139.35 at the moment.