US Dollar trims losses to 89.60 ahead of Beige Book
- US Dollar remains in red figures in the mid-89.00s ahead of Beige Book.
- US 10-year yields leap to daily highs near 2.87%.
- Fed’s Beige Book next on tap. Earlier, ADP report came in at 235K.
The greenback, gauged by the US Dollar Index, remains depressed and is trading close to daily lows in the 89.50 region despite auspicious ADP figures.
US Dollar weaker on risk-off trade
The index is down for the second session in a row on Wednesday, extending the weekly leg lower amidst a moderate pick up in the risk aversion after Trump’s economic adviser Gary Cohn stepped down late on Tuesday.
Concerns over the likelihood of a global trade war in retaliation of US tariffs on imports of steel (25%) and aluminium (10%) from trade partners have grown bigger in past hours and are undermining any bullish attempt from USD.
In the data space, auspicious results from February’s ADP report (235K) failed to spark any signs of live in the greenback, while the trade deficit widened more than expected in January. Later in the session, the Fed will publish its Beige Book.
US Dollar relevant levels
As of writing the index is losing 0.02% at 89.59 and a break below 89.43 (low Mar.7) would open the door to 88.44 (low Jan.26) and finally 88.25 (2018 low Feb.16). On the flip side, the next hurdle emerges at 89.82 (21-day sma) seconded by 89.97 (10-day sma) and then 90.57 (high Feb.8).