EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Pulls Back As GDP Growth Rate Report Misses Expectations

U.S. Dollar

U.S. Dollar Index pulled back as traders reacted to the GDP Growth Rate report, which indicated that GDP Growth Rate pulled back from 3.4% in Q4 2023 to 1.6% in Q1 2024. Analysts expected that first-quarter GDP Growth Rate would reach 1.6%, so the report missed expectations. Interestingly, Treasury yields continued to move higher. The yield of 2-year Treasuries settled near the psychologically important 5.00% level, while the yield of 10-year Treasuries moved above 4.70%. However, rising Treasury yields did not provide support to the American currency.

If U.S. Dollar Index declines below 105.50, it will head towards the nearest support, which is located in the 104.40 – 104.60 range.

EUR/USD

EUR/USD gains ground, supported by the better-than-expected GfK Consumer Confidence data from Germany. The report showed that Consumer Confidence improved from -27.3 in April to -24.2 in May.

In case EUR/USD climbs above the resistance at 1.0700 – 1.0720, it will head towards the next resistance at 1.0785 – 1.0800.

GBP/USD

GBP/USD is moving higher despite rising Treasury yields as traders focus on the disappointing U.S. GDP Growth Rate report.

From the technical point of view, GBP/USD has settled in a range between the support at 1.2425 – 1.2450 and the resistance at 1.2530 – 1.2550.

USD/CAD

USD/CAD is mostly flat despite the rebound in precious metals markets. Other commodity-related currencies are also swinging between gains and losses in today’s trading session.

If USD/CAD manages to settle above the 1.3700 level, it will head towards the next resistance, which is located in the 1.3780 – 1.3800 range.

USD/JPY

USD/JPY is moving higher as traders remain focused on rising Treasury yields. The yield of 10-year Japan government bonds jumped to 0.94% amid reports indicating that BoJ was ready to reduce bond purchases. However, the spread between U.S. government bonds and Japan government bonds is too large, so the Japanese yen needs additional positive catalysts to break the current trend.

There are no indications of interventions from the BoJ, and USD/JPY is heading towards the 156.00 level.

For a look at all of today’s economic events, check out our economic calendar.