The action in foreign exchange markets remain choppy on Wednesday as investors refrain from taking large positions ahead of key events.
Bank of England Governor Andrew Bailey, European Central Bank President Christine Lagarde and Federal Reserve Chairman Jerome Powell will be delivering speeches later in the day.
Powell will participate in a moderated discussion at the New York Times DealBook Summit, starting at 18:45 GMT.
The US economic calendar will feature ADP Employment Change and ISM Services PMI data for November.
Following Monday’s rebound, the DXY Dollar Index lost its momentum and registered small losses on Tuesday. The index fluctuates in a tight range below 106.50 early Wednesday, while US stock index futures trade in positive territory.
Following news of South Korean President Yoon Suk Yeo declaring martial law, the USDKRW pair surged to its highest level in two years above 1,440 during the American trading hours on Tuesday.
In the Asian session on Wednesday, the Bank of Korea said that it will deploy various measures to stabilise the Korean Won exchange rate. Additionally, the parliament in Seoul stepped in hours after President Yoon’s announcement to soundly reject the martial law call and opposition parties submitted an impeachment bill against the president.
Following these developments, the USDKRW staged a deep correction and was last seen losing 0.6% on the day at around 1,409.
EURUSD struggled to gather bullish momentum and posted small gains on Tuesday. The pair holds its ground on Wednesday and trades above 1.0500. ECB President Lagarde will testify before the Committee on Economic and Monetary Affairs of the European Parliament in Brussels, Belgium, starting at 13:30 GMT.
GBPUSD closed with small gains on Tuesday and continued to edge higher toward 1.2700 early Wednesday. BoE Governor Bailey’s pre-recorded keynote interview at the Financial Times Live Global Boardroom will be released at 09:00 GMT.
The data from Australia showed on Wednesday that the gross domestic product grew at an annual rate of 0.8% in the third quarter. This GDP reading followed the 1% growth recorded in the second quarter and missed the market expectation of 1.1%.
AUDUSD turned south following the disappointing data and dropped to its weakest level since early August near 0.6400. The pair stages a correction in the European morning and trades near 0.6450.
After closing the second consecutive day virtually unchanged on Tuesday, USDJPY gains traction and trades in positive territory above 150.00 early Wednesday.
Gold failed to make a decisive move in either direction and closed virtually unchanged on Tuesday. XAUUSD extends its sideways grind below $2,650 in European trading on Wednesday.
(Source: OANDA)
