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USD Forex Market Strength Remains Despite Peace Talks

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  • Dollar Remains Strong Ahead of Speeches
  • Russia Peace Talks Fail to Lift Euro or Pound
  • Stock Trading Remains Volatile

The Dollar strength in the forex market shows little sign of relenting on Tuesday even as a temporary dip at the beginning of the week presenting the opportunity for other currencies to advance. This avenue has now been shut despite peace talks between Ukraine and Russia looking set to continue. ECB speeches are due today and could move the Euro while the opening remarks of Fed Chair Jerome Powells remarks for Wednesday will also be released. Meanwhile, markets remain volatile on Wall Street as earnings continue to come in.

Dollar Strength Continues Amid Peace Talks

There had been a short period on Monday where the Dollar weakened slightly. This came as peace talks took place on the Ukrainian border between leaders on both sides. Though no agreement has been reached, it appears that talks will go into a second round. This momentary weakness is all that those forex trading the Dollar have seen in the past week. 

The Dollar has otherwise been resolute as a safe haven for most traders alongside precious metals like gold. This strong position was restored during the European trading session today with the US Dollar Index again moving back close to 97.00 and the Euro giving back any ground it may have gained. Manufacturing PMIs from the US are also due later in the day though it remains to be seen if they move the market.

Euro and Pound Both Struggle

It has been a challenging time for the Euro and Pound. Both major currencies have struggled to regain any kind of traction, particularly following the recent Russian invasion of Ukraine. Even prior to this, forex brokers will have noticed the difficulty both currencies were having in the face of looming rate hikes from the Fed. 

The Euro dropped off further today below 1.12 despite positive signs. Inflation figures from the largest economy in the bloc, Germany, could prove key to the next move. ECB President Christine Lagarde is also scheduled to speak today. At the same time, the Pound has remained stuck around the 1.34 mark.

Wall Street Prepares for More Movement

Stock futures slid into March with the Dow Jones down around 200 points in early trading before the opening bell. Markets have been volatile recently though there seemed to be some positive sentiment returning in recent days. Uncertainty over any peace deal progress between the Ukraine and Russia though has meant that volatility continues to be a factor. Analysts though are hopeful that the majority of the selling has been done. 

Earnings reports continue with Target beating EPS estimates to gain almost 10% in the premarket. This has helped to balance the market with turbulence elsewhere. Again, manufacturing PMIs as well as other earnings due to report both before and after the bell will have an impact throughout the day.

Anthony is a financial journalist and business advisor with several years’ experience writing for some of the most well-known sites in the Forex world. A keen trader turned industry writer, he is currently based in Shanghai with a finger on the pulse of Asia’s biggest markets.