The dollar strengthened against its major counterparts on Tuesday as jitters over global growth, particularly in China, caused demand for the safe-haven U.S. currency, while the Aussie dollar slumped after the Reserve Bank of Australia kept rates steady.
China’s services activity expanded at the slowest pace in eight months in August, a private-sector survey showed on Tuesday, as weak demand continued to dog the world’s second-largest economy and stimulus failed to meaningfully revive consumption.
Gold prices had an indecisive trade while copper prices were flat on Tuesday, also coming under pressure from a steady dollar. A private survey showed that China’s service sector grew less than expected in August, offsetting some optimism over an earlier reading that showed some resilience in the manufacturing sector.
Crude oil reached its highest levels since November. Oil prices sparked more than two percent after Saudi Arabia and Russia extended their voluntary supply cuts by three months to the end of this year, worrying investors about potential shortages during peak winter demand.
MCX Gold futures settled at 59243 down 0.25%. Silver at 73445 down 1.44%. Copper prices settled at 740.45 up 0.52%. Crude oil settled at 7218 up 1.53%. Natural gas settled at 216.20 down 2.04%.
Economic data and events scheduled today
Eurozone
At 11.30pm – German Factory Orders m/m. Previous was at -4.3%, forecast is 7.0%.
At 2.30pm – Retail Sales m/m. Data is foreseen at -0.10%, previous was at -0.30%.
All above data could have a neutral impact on the Euro.
U.K.
At 2.00pm – Construction PMI. Foreseen at 49.80. Forecast is 51.70.
At 6.45pm – Monetary Policy Report Hearings.
All above data could have a neutral impact on the Pound.
Canada.
At 6.00pm – Trade Balance. Forecast is -3.5B, previous was at -3.7B.
At 7.30pm – BOC Rate Statement. Overnight Rate. Forecast is to keep unchanged at 5.00%.
Above data could have a volatile impact on the dollar.
U.S.
At 6.00pm – Trade Balance. Forecast is -67.9B, previous was at -65.5B.
At 7.15pm – Final Services PMI. Forecast is 51.00 from 51.00.
At 7.30pm – ISM Services PMI. Forecast is 52.50 from the previous 52.7.
Tentative – IBD/TIPP Economic Optimism. Forecast is 41.1 previous was 40.30.
All above data could have a negative impact on the dollar.