Lower Treasury yields and higher equities are also part of the story, as the dollar moves lower in European morning trade. As mentioned earlier here, these markets are all going to be intertwined as we get to the US CPI data later and it is already showing. EUR/USD is now up 0.5% to just above 1.0800 and contesting a key technical resistance:
EUR/USD daily chart
The pair is running into its 100-day moving average (red line) at 1.0805 and a break above that will see buyers establish a more bullish bias again after the decline in May.
The greenback is weak across the board as traders seem to be leaning to the idea of a softer set of inflation numbers later today, or perhaps the expectation that it will take a massive beat to really convince the Fed to hike tomorrow.
That sentiment is also reflected in the bond market, with 10-year Treasury yields down 3.5 bps to 3.73% currently. Meanwhile, equities are looking upbeat with S&P 500 futures up 0.3% and Nasdaq futures up 0.6%.
Going back to the dollar, GBP/USD is up 0.4% to 1.2560 and holding gains after the stronger UK jobs report earlier. USD/CHF is down 0.4% to 0.9050 while the antipodeans are also holding some light gains so far on the session. AUD/USD is up 0.4% to 0.6780 and eyeing a test of the key resistance region from the April and May highs around 0.6793-00.