Forex Today: US Dollar falls as markets assess Fed transition and US-Iran negotiations
Here is what you need to know for Tuesday, May 19:
The US Dollar Index (DXY) falls toward the 99.10 region on Monday as traders assess fresh geopolitical headlines and the upcoming leadership transition at the Federal Reserve (Fed).
A White House official stated that United States (US) President Donald Trump will swear in Kevin Warsh as the next Fed Chairman on Friday, after the Senate voted to approve him for a four-year term, replacing Jerome Powell. Investors remain cautious as markets evaluate how the Fed’s policy direction could evolve under the new leadership.
At the same time, traders monitored new developments surrounding the US-Iran negotiations. Axios reported that Iran’s latest proposal was viewed by the White House as “insufficient for a deal,” according to a senior US official. Meanwhile, US President Donald Trump said he has ordered a pause on a planned US military attack scheduled for Tuesday after appeals from Qatar, Saudi Arabia and UAE leaders.
Iranian news agency Tasnim stated that the US accepted a temporary lifting of Iran’s Oil sanctions during negotiations, while Tehran continues demanding the full removal of sanctions as part of any agreement. The mixed headlines improved risk appetite slightly and reduced some safe-haven demand for the Greenback.
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 Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.22% | -0.74% | 0.08% | -0.07% | -0.23% | -0.58% | -0.30% | |
| EUR | 0.22% | -0.54% | 0.28% | 0.14% | -0.03% | -0.37% | -0.09% | |
| GBP | 0.74% | 0.54% | 0.81% | 0.68% | 0.52% | 0.16% | 0.45% | |
| JPY | -0.08% | -0.28% | -0.81% | -0.18% | -0.32% | -0.69% | -0.39% | |
| CAD | 0.07% | -0.14% | -0.68% | 0.18% | -0.15% | -0.51% | -0.22% | |
| AUD | 0.23% | 0.03% | -0.52% | 0.32% | 0.15% | -0.35% | -0.05% | |
| NZD | 0.58% | 0.37% | -0.16% | 0.69% | 0.51% | 0.35% | 0.30% | |
| CHF | 0.30% | 0.09% | -0.45% | 0.39% | 0.22% | 0.05% | -0.30% |
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 rebounds toward the 1.1640 region, benefiting from a softer US Dollar (USD) amid ongoing geopolitical developments and hawkish Fed expectations.
GBP/USD advances near the 1.3420 area amid easing safe-haven demand, pressuring the USD. Sterling also finds some support despite persistent concerns surrounding the United Kingdom (UK) fiscal outlook and political uncertainty.
USD/JPY climbs toward the 158.90 zone as the Japanese Yen (JPY) weakens ahead of Japan’s preliminary Q1 flash Gross Domestic Product (GDP) release. Japan Chief Cabinet Secretary Yoshimasa Kihara stated that authorities are watching financial-market developments, including long-term rates, with a “very high sense of urgency,” as elevated Japanese bond yields continue to fuel speculation about future Bank of Japan (BoJ) policy normalization.
AUD/USD rises toward the 0.7160 region as improving market sentiment and the softer Greenback support demand for risk-sensitive currencies.
West Texas Intermediate (WTI) Oil trades flat near $102.30 per barrel, after conflicting headlines surrounding US-Iran negotiations and the potential temporary easing of sanctions on Iranian Oil exports.
Gold (XAU/USD) trades neutral near the $4,559 area as the softer USD supports demand for the precious metal, while ongoing geopolitical uncertainty surrounding the Middle East continues to underpin safe-haven flows.
What’s next in the docket:
Tuesday, May 19:
- Australia May Westpac Consumer Confidence, RBA Meeting Minutes
- UK March Labor Market Data (Average Earnings, Employment Change, Unemployment Rate)
- UK April Claimant Count Data
- US ADP Employment Change 4-week average
- Canada April Inflation Data (BoC Core CPI, CPI)
- US April Pending Home Sales
Wednesday, May 20:
- China PBoC Interest Rate Decision
- UK April Inflation Data (CPI, Core CPI, PPI, RPI)
- Germany April Harmonized Index of Consumer Prices
- NZ April Trade Data (Exports, Imports, Trade Balance)
- Australia May Preliminary S&P Global PMIs
- Japan April Trade Data (Exports, Imports, Trade Balance)
Thursday, May 21:
- Australia May Consumer Inflation Expectations
- Australia April Labor Market Data (Employment Change, Participation Rate, Unemployment Rate)
- Germany April Producer Price Index
- Switzerland Q1 Industrial Production
- France May Preliminary HCOB PMIs
- Germany May Preliminary HCOB PMIs
- EU May Preliminary HCOB PMIs
- UK May Preliminary S&P Global PMIs
- US April Housing Data (Building Permits, Housing Starts)
- US Initial Jobless Claims, May Philadelphia Fed Manufacturing Survey
- US May Preliminary S&P Global PMIs
- EU May Preliminary Consumer Confidence
- NZ Q1 Retail Sales
- UK May GfK Consumer Confidence
- Japan April CPI
Friday, May 22:
- Germany Q1 Gross Domestic Product
- UK April Retail Sales
- Germany May IFO Survey (Business Climate, Current Assessment, Expectations)
- Canada March Retail Sales
- US May Michigan Consumer Sentiment and Inflation Expectations
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.
