AUD/USD trades just below 0.7100 on Tuesday, a touch lower for the day and sliding from the two-month highs reached on Monday.

NZD/USD retreats on Tuesday and trades around 0.5880 at the time of writing, down 0.38% on the day. The New Zealand Dollar (NZD) remains under pressure as mounting geopolitical tensions between the United States (US) and Iran fuel risk aversion and support demand for the US Dollar (USD).

USD/JPY extends its sideways movement below the 160 psychological mark on Tuesday as the US Dollar (USD) struggles to gain traction.

Scotiabank strategists Shaun Osborne and Eric Theoret note the Euro (EUR) is resilient around 1.1576, with Germany’s ZEW survey showing improving expectations and a slow recovery backdrop. Short-term EUR/USD technicals are described as bullish, with strong intraday and daily momentum.

The Pound Sterling steadies on Tuesday as geopolitical tensions rise in the Middle East, while housing data misses estimates and US Industrial Production decelerates. The GBP/USD trades at 1.35846.

AUD/USD edges higher on Tuesday and trades around 0.7115 at the time of writing, up 0.12% on the day.

Scotiabank strategists Shaun Osborne and Eric Theoret report USD/CAD trading near equilibrium around 1.3870, with Canadian Dollar (CAD) fundamentals supported by narrower front-end spreads and firm crude prices. They see investors relatively unconcerned by looming US tariff deadlines.

EUR/USD consolidates losses on Tuesday after pulling back from a two-month high of 1.1614 reached the previous day.

BNY’s Geoff Yu highlights that foreign holdings of New Zealand government bonds rose to 58.9% in July 2026, while NZD/USD trades slightly above its 12‑month average.

Rabobank’s Mauricio Une and Renan Alves note softer United States (US) inflation and cooling labor data, giving the Federal Reserve (Fed) more time to assess policy.

Chris Turner at ING describes EUR/USD as contained after a rally stalled just above 1.16, with investors cautious due to high natural gas prices and upcoming FOMC minutes. He expects a 1.1520–1.1580 range near term, while higher energy supports ECB hike expectations.

USD/CAD trades little changed on Tuesday as rising long-term US Treasury yields lift the US Dollar (USD), while elevated Oil prices underpin the commodity-linked Canadian Dollar (CAD). At the time of writing, the pair trades around 1.3874, near levels last seen in early June.

The New Zealand Dollar (NZD) trades lower against the US Dollar (USD) on Tuesday, weighed by a moderate risk-averse sentiment as tensions in the Middle East grow.

The Japanese Yen (JPY) underperforms its major currency peers on Tuesday, with USD/JPY trading 0.16% higher at around 159.70 during the European trading session.

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note USD/JPY’s slight increase in upward momentum after trading between 158.82 and 159.59 still falls short of signaling a sustained advance, keeping intraday price action likely confined to 159.00–159.80.

EUR/CAD depreciates after three days of gains, trading around 1.1570 during the European hours on Tuesday. The pair loses ground as the Euro (EUR) remains subdued following the release of German ZEW Survey data.

The British Pound (GBP) is down 0.1% to near 1.3530 against the US Dollar (USD) during the European trading session on Tuesday. The British currency comes under pressure after the release of the United Kingdom (UK) employment data for three months ending June.

USD/CAD extends its losses for the fourth successive day, trading around 1.3870 during the European hours on Tuesday. The currency pair depreciates as the commodity-linked Canadian Dollar (CAD) gains support from firming crude oil prices.

MUFG’s Halpenny notes that EUR/USD remains capped near its 200-day moving average at 1.1630 and is 2.5%-3.0% overvalued in the bank’s short-term model.

The Australian Dollar (AUD) trades almost flat at around 0.7100 against the US Dollar (USD) during the European trading session on Tuesday, but is close to its over two-month high of 0.7130 posted on Monday.

Commerzbank FX analyst Michael Pfister highlights that the Canadian Dollar’s recent weakness contrasts with a fragile recovery in Canada’s real economy.

The British Pound (GBP) edges higher against the Japanese Yen (JPY) on Tuesday and extends gains for the third consecutive day, despite the mixed UK employment figures seen earlier on the day.

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann highlight that AUD/USD strength remains intact after a jump to 0.7129, though overbought conditions should confine intraday moves to a 0.7090–0.7130 band.

ING’s Chris Turner reports a firmer EUR/GBP after UK labour data, with economist James Smith highlighting a cool jobs market and minimal wage pressures, implying little impetus for Bank of England hikes this year.

The Japanese Yen (JPY) accelerates its decline as the US Dollar (USD) draws support from a sourer market mood, with investors wary of a re-escalation of tensions in the Middle East.

The USD/CAD pair struggles to capitalize on the overnight bounce from its lowest level since June 3, around the 1.3845 zone, also representing the 200-day Simple Moving Average (SMA) support, and oscillates in a narrow band on Tuesday.

Here is what you need to know on Tuesday, August 18:

The EUR/GBP cross posts modest gains near 0.8550 during the early European trading hours on Tuesday. The British Pound (GBP) attracts some sellers against the Euro (EUR) following the UK employment data. Traders brace for the ZEW Survey from Germany and the Eurozone later on Tuesday.

The British Pound (GBP) extends its reversal against the US Dollar (USD) on Tuesday as June’s UK unemployment data fails to convince investors in an already risk-off market, as tensions in the Middle East rise.

The British Pound (GBP) faces selling pressure against the Japanese Yen (JPY) after the release of the United Kingdom (UK) labor market data for three months ending in June, dropping to near 215.95.