US dollar bouces but remains lower on the day | Forexlive

The US dollar has bounced in a modest reversal of earlier aggressive sales. The turn has knocked the euro down to 1.0818 from a high of 1.0838.

The trade appears to be largely flow-driven with the earlier dollar selling taking its cues from falling short-dated yields. Treasury yields remain at the lows of the day so all the factors for dollar selling remain aligned. The move could further extend if US equities can find a footing.

Yields could fall further as oil appears to be coming under selling pressure. WTI is down 1.9%, all of it coming in the past hour or so. That should help to cool inflation fears.

Overall though, it’s tough to get a strong read on the market today. China rate cuts are reverberating but not the price action in Chinese stocks is hardly inspiring, so it’s a tough move to get behind.