Forex Today: A back-to-back rate cut by the RBA is priced in

As investors remained wary over trade tensions following President Trump's announcement of tariffs on Japan and South Korea, the Greenback gained momentum, rising to multi-day highs and sparking a generalised strong correction in the risk-associated space on Monday.

Here's what to watch on Tuesday, July 8:

The US Dollar Index (DXY) rose to eight-day highs near 97.70 accompanied by rising US yields across the curve in a context of steady caution ahead of the July 9 tariff deadline. A light calendar will feature the NFIB Business Optimism Index followed by the API’s weekly report on US crude oil inventories.

EUR/USD broke below the 1.1700 support to reach multi-day lows in response to the marked bounce in the US Dollar. Germany’s Balance of Trade results are due in along with the speech by the ECB’s Nagel.

GBP/USD traded on the back foot, slipping back below the 1.3600 level amid the strong resurgence of the risk-off mood. Next on tap across the Channel will be the BoE’s Financial Stability Report on July 9.

USD/JPY advanced to two-week tops past the 146.00 barrier, underpinned by the pronounced uptick in the Greenback. The Current Account results are due, followed by Bank Lending prints and the Eco Watchers survey.

AUD/USD retreated for the third consecutive day, breaching below the 0.6500 support, or multi-day lows. The RBA will decide on rate, seconded by the usual press conference by Governor Bullock and the NAB’s Business Confidence print.

WTI prices reversed two daily pullbacks in a row, reaching two-week highs above the $68.00 mark per barrel as investors shrugged off supply concerns and shifted their attention to prospects of stronger demand in the near term.

Gold prices reversed the initial bearish tone and managed to regain traction on Monday, flirting with the $3,340 zone per troy ounce on the back of increasing trade jitters. Silver prices set aside two daily advances in a row and approached the $36.00 zone per ounce on Monday, just to bounce afterwards.