Following a modest recovery in North America, the US dollar has shown limited momentum today, weakening against most G10 currencies. The Swiss franc leads the gains, boosted by stronger-than-expected Q1 GDP, with the Japanese yen also performing well. Commodity-linked currencies are under pressure, likely due to falling oil prices amid speculation of a potential US-Iran deal. While most emerging market currencies are firm, notable underperformers include those from China, India, Thailand, and Russia. On the commodities front, gold dipped to a one-month low before slightly rebounding, while oil continued its slide, testing new weekly lows.

Asia Pacific Markets

In Asia-Pacific trading, the Japanese yen has strengthened after a volatile session in which the dollar swung in a two-yen range. Despite an earlier climb above JPY147, it retreated toward JPY145.50, with the upcoming GDP report expected to show a slight contraction driven by weak consumption and investment.
Meanwhile, in Australia, the local dollar initially breached $0.6500 but faced resistance and fell back, even after surprisingly strong employment data showing an 89,000 job gain in April. Despite the labor market's resilience, investors still expect the Reserve Bank of Australia to cut rates next week and signal further easing this year.

European Markets

The euro initially climbed to a multi-day high but faced selling pressure in North America, retreating sharply before recovering modestly. Economic data was mixed: Eurozone Q1 GDP was revised slightly downward, yet industrial production posted an impressive 2.6% surge, its strongest since late 2022.
The British pound also showed volatility, hitting a five-day peak before slipping. The UK economy posted 0.7% growth in Q1, driven by improved consumption and a surprise rise in business investment. However, falling industrial output and a decline in government spending tempered the optimism. Trade data showed a narrowing deficit, providing some support to the pound.

American Markets

The US Dollar Index rebounded from a recent low to test resistance near 101.00 but failed to hold gains, slipping back toward 100.60. While technical support remains intact around 99.90, buying interest has faded. A busy economic calendar today includes retail sales, industrial production, and producer price data, alongside two Fed business surveys and March business inventory figures. Early indications suggest weaker retail activity, with real-time models projecting a decline. Meanwhile, the Fed’s updated growth outlook sees Q2 GDP tracking at 2.3%. The delay of US-China tariff hikes has improved sentiment, prompting analysts to scale back recession risks and lift growth forecasts.