Forex Today: DXY falls after Middle East tensions ease, markets eye US NFP
Here is what you need to know for Thursday, May 7:
The US Dollar Index (DXY) slides near the 98.00 area, with limited losses supported by resilient United States (US) data but capped by improving risk sentiment after Axios reported that the US and Iran are moving closer to a deal aimed at ending the conflict.
Geopolitical relief has eased fears of prolonged disruption to global energy flows, weighing on safe-haven demand for the US Dollar while supporting risk-sensitive currencies. Still, the Greenback remains underpinned after ADP Employment Change showed US private employers added 109K jobs in April, above expectations of 99K and improving from March’s revised 61K gain.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.52% | -0.42% | -0.97% | 0.09% | -0.79% | -1.22% | -0.60% | |
| EUR | 0.52% | 0.09% | -0.44% | 0.63% | -0.27% | -0.73% | -0.08% | |
| GBP | 0.42% | -0.09% | -0.53% | 0.54% | -0.36% | -0.81% | -0.15% | |
| JPY | 0.97% | 0.44% | 0.53% | 1.06% | 0.16% | -0.25% | 0.40% | |
| CAD | -0.09% | -0.63% | -0.54% | -1.06% | -0.88% | -1.31% | -0.68% | |
| AUD | 0.79% | 0.27% | 0.36% | -0.16% | 0.88% | -0.43% | 0.18% | |
| NZD | 1.22% | 0.73% | 0.81% | 0.25% | 1.31% | 0.43% | 0.64% | |
| CHF | 0.60% | 0.08% | 0.15% | -0.40% | 0.68% | -0.18% | -0.64% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
EUR/USD is elevated near the 1.1750 price zone, though upside remains limited as traders balance softer safe-haven flows against the resilient US labor market.
GBP/USD holds near recent levels at 1.3600, struggling to extend gains as the US Dollar remains somewhat supported by firm employment data and cautious positioning.
USD/JPY trims part of its intraday losses near the 156.40 level, with the pair caught between lower safe-haven demand for the USD and firm US data, while markets continue to watch the Bank of Japan’s (BoJ) policy outlook.
AUD/USD surged toward the 0.7240 region, benefiting from stronger risk appetite as hopes for a US-Iran deal lifted demand for the Australian Dollar.
West Texas Intermediate (WTI) Oil falls sharply near $94.90 per barrel as fears of a prolonged Middle East supply disruption fade following reports of progress toward a US-Iran agreement.
Gold surges near the $4,700 price zone as safe-haven demand softens, with investors rotating back into risk-sensitive assets amid hopes of reduced geopolitical tensions.
What’s next in the docket:
Thursday, May 7:
- Australian Trade Balance
- Germany Factory Orders March MoM YoY
- Eurozone Retail Sales March MoM YoY
- US Challenger Job Cuts April
- US Initial Jobless Claims
- US Nonfarm Productivity Q1 Prel
- US Unit Labor Costs Q1 Prel
Friday, May 8:
- Germany Industrial Production March MoM YoY
- Eurozone Trade Balance March
- Canadian Employment data
WTI Oil FAQs
What is WTI Oil?
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
What factors drive the price of WTI Oil?
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
How does inventory data impact the price of WTI Oil
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
How does OPEC influence the price of WTI Oil?
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
