Pip Diddy

The Aussie dropped sharply as a quarterly report missed estimates. The Kiwi also clocked in losses, however, on overall risk aversion and threats of a trade war between the world’s two largest economies.

Brexit jitters continued to drag the pound down for the rest of the U.S. session and market participants seemed to be in no mood to take on more risk.

The pound really suffered during the morning London session, thanks to renewed Brexit-related jitters after the E.U.’s draft withdrawal agreement was released. Meanwhile, the Aussie and the yen were fighting for the top spot.

The dollar extended its gains from the previous session, but was upstaged by the yen when risk aversion and a few data misses pushed it higher.

Dollar bulls were relieved to find out that the new Fed head is set on continuing the central bank’s tightening plans, even throwing in a few upbeat remarks here and there.

Price action was rather choppy during the morning London session. Even so, there were some themes that were clearly playing out, such as the pound getting whupped and demand for both the yen and the Greenback.

New Zealand’s return to trade deficit dragged Kiwi lower across the board. Meanwhile, other currencies traded on tight ranges ahead of Powell’s testimony.

All eyes and ears were on ECB head Draghi’s testimony as his optimistic outlook for the euro zone economy lifted the shared currency. Meanwhile, the Loonie took fresh hits on NAFTA jitters.

There wasn’t much on the docket today. Even so, there was more than enough action to keep the session interesting, with the pound’s strength and the Loonie’s weakness being the most notable themes.

The week promises to be another interesting one for the dollar with Uncle Sam printing PMIs and Fed Chairman Powell himself scheduled to make testimonies.