On Tuesday, in early Asian sessions, the Dollar was on the defensive, after Chicago Federal Reserve President Charles Evans reinforced the perception that the US Central Bank won’t accelerate the pace of its interest rate hikes. Evans strengthened the Central Bank’s call for two more interest rate increases this year, disappointing Dollar bulls who had hoped for a faster pace of hikes. Evan’s comments helped to bring down the 10-year US Treasuries Yield to 2.461%, its lowest level in two weeks. The Dollar Index edged down as well by 0.1% to 100.35, the lowest since February 2007.
Early on Tuesday also, Oil prices rebounded on expectations that an OPEC-led production cut to prop up the market could be extended, while strong demand would also work to slowly erode a global fuel supply overhang. Oil prices have slumped more than 10% year-to-date, dragged lower by rising shale-oil production and inventories in the US, which have nearly wiped out all the gains reaped since the OPEC and Russia last year consented to cut 1.8 million barrels of their daily production in the first half of 2017.
Meanwhile, the Australian Dollar weakened against its major peers, as investors digested the minutes of the Reserve Bank of Australia’s (RBA) meeting. Minutes from the meeting revealed that members of the RBA’s monetary policy board expected to see consumer prices rising at a gradual pace. The members noted that the Australian economy is continuing to move away from a focus on mining investment, in spite of a mild rebound in commodity prices.