The USD/JPY commenced Tuesday’s Asian session with little movement, stabilizing around 149.59 with a slight increase of 0.06%. This comes after the pair recorded a decrease of 0.74% on Monday. The market remains watchful of the U.S. trade policy under the Trump administration, which has significantly influenced currency movements. The imposition of tariffs on Mexico, Canada, and China, effective March 4, continues to weigh down the Greenback against most G7 currencies.
The recent decline in U.S. yields, following weaker-than-expected PMI data, has bolstered XAU/USD, providing support for gold prices. On Monday afternoon, gold managed to distance itself from a multi-week low near $2,830 reached last Friday, trading above $2,880 as the day progressed. This recovery highlights the precious metal's resilience amid global economic uncertainties.
The soft U.S. data has negatively impacted the U.S. Dollar, leading to a pullback against major G7 currencies. This depreciation has been beneficial for other currency pairs such as the AUD/USD. After experiencing six consecutive days of losses, the AUD/USD managed to retest the 0.6250 zone on Monday, buoyed by the sharp retreat of the U.S. Dollar. Market analysts anticipate that the release of the Reserve Bank of Australia (RBA) Minutes will further influence the AUD/USD in upcoming sessions.
The ongoing trade tensions and fluctuating U.S. economic indicators have kept investors on edge, influencing both currency and commodities markets. The Greenback's struggles have been evident as it continues to show weakness amid global economic pressures and policy uncertainties.