Forex Today: Focus stays on Fedspeak amidst broad-based consolidation

The Greenback traded with decent gains against the backdrop of a generalized consolidative phase in the global markets, as the FX universe slowly shifted its attention to the release of US CPI next week.

Here is what you need to know on Wednesday, May 8:

The USD Index (DXY) advanced modestly and managed to revisit the 105.40 region amidst still declining US yields. On May 8, the weekly Mortgage Applications by MBA are due seconded by Wholesale Inventories and speeches by Fed’s Jefferson, Collins and Cook.

The resurgence of some selling impetus motivated EUR/USD to return to the 1.0750 zone and give away part of its recent positive streak. On the domestic calendar, Industrial Production in Germany is due on May 8 prior to the publication of the ECB Accounts on May 10.

GBP/USD corrected markedly lower and reversed a multi-day recovery. Cable, in the meantime, needs to clear the key 200-day SMA around 1.2545 to allow for a potential test of recent peaks near 1.2630. Next on tap in the UK docket will be the BoE gathering on May 9.

Further JPY selling sponsored the second consecutive daily advance in USD/JP, this time reclaiming the area beyond the 154.00 yardstick. On May 8, weekly Foreign Bond Investment prints are expected.

AUD/USD appears to have met quite a decent resistance around the 0.6650 region so far. Following the RBA meeting earlier on Tuesday, the next significant release will be the Wage Price Index on May 15.

WTI prices remained slightly on the defensive in the lower end of the recent range as traders gauged geopolitical concerns and prospects of weak demand.

Prices of Gold retreated marginally on the back of the small advance in the Greenback and hopes of a ceasefire in the Middle East. Silver prices, in the meantime, attempted some consolidation in the area of recent peaks around $27.50.