The General Administration of Customs will publish its data for December on Wednesday at 03.00 GMT. Trade balance is expected to widen to $113.60B in December, compared to $111.68B in the previous reading.

EUR/USD trades with losses on Tuesday even though the latest inflation in the United States was benign, hinting that the Federal Reserve could indeed reduce interest rates as priced in by the financial markets. At the time of writing, the pair trades at 1.1642, down by over 0.20%.

The USD/JPY pair jumps to near 159.15, the highest since July 2024, during the early Asian session on Wednesday. The Japanese Yen (JPY) weakens against the US Dollar (USD) amid concerns about looser fiscal and monetary policy in Japan.

South Korea Unemployment Rate increased to 4% in December from previous 2.7%

The US Dollar (USD) resumed its robust recovery on Tuesday, leaving behind Monday’s pessimism as investors continued to assess the latest US CPI data while gearing up for further inflation readings, Retail Sales and comments from Fed officials.

The Australian Dollar (AUD) trades on the back foot against the US Dollar (USD) on Tuesday, pressured by a firmer Greenback following the release of the latest US inflation figures. At the time of writing, AUD/USD trades around 0.6677, retracing all of the previous day’s gains.

USD/CAD trades around 1.3880 on Tuesday at the time of writing, virtually unchanged on the day, amid mixed macroeconomic signals from the United States (US) and Canada-specific supportive factors.

The Japanese Yen (JPY) weakens further against the US Dollar on Tuesday as the Greenback strengthens following the release of the latest US inflation report. USD/JPY trades around 159.00 at the time of writing, hovering near levels last seen in July 2024.

The British Pound turns negative on the day, yet it remains near its Tuesday’s opening price after the latest inflation report in the US indicates that the Federal Reserve could continue to ease policy in 2026. The GBP/USD trades at 1.3450, down 0.03%.

The Euro (EUR) recovers modestly against the British Pound (GBP) on Tuesday, trimming earlier losses after attracting dip-buying interest near the 0.8650 region.

The Japanese Yen (JPY) fell 0.5% against the US Dollar (USD), underperforming all G10 currencies, as speculation over PM Takaichi’s snap election drove renewed selling and pushed USD/JPY toward levels last seen in early 2025, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

The Euro (EUR) is trading flat to the US Dollar (USD) and consolidating in a tight range following Monday’s attempt at a bullish reversal of the pullback from mid/late December, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

USD/CHF trades around 0.7980 on Tuesday at the time of writing, up 0.10% on the day, but off its intraday high following the release of US inflation data.

The Euro (EUR) holds firm against the US Dollar (USD) on Tuesday as traders show a limited reaction to the latest US inflation data. At the time of writing, EUR/USD trades around 1.1667, as the Greenback softens modestly.

The Canadian Dollar (CAD) is trading little changed on the day. Along with a minor gain for the MXN and the generally firmer USD, there is a mild bid for North American FX across markets, Scotiabank's Chief FX Strategists Shaun Osborne and Eric Theoret report.

The British Pound (GBP) pushes higher against the Japanese Yen (JPY) on Tuesday, supported by broad-based Yen weakness as political developments in Japan weigh on sentiment.

The Australian Dollar remains trading within previous ranges against its US counterpart, as the pair’s recovery from the 0.6660 area was capped at 0.6725 on Monday before pulling back to 0.6700.

The Japanese Yen (JPY) fell 0.5% to 158.91 per US Dollar (USD), hitting its weakest level since July 2024, as speculation of a snap election under PM Takaichi triggered renewed selling, ING's FX analyst Francesco Pesole notes.

JPY and JGB slide, while the Nikkei rallies as Japan election talks fuel bets of more government stimulus.

EUR/GBP trades in a tight range around 0.8660 on Tuesday, virtually unchanged on the day at the time of writing.

EUR/USD missed an opportunity to break above 1.1700, with the euro lacking momentum while the US Dollar (USD) could strengthen further on upcoming inflation data, ING's FX analyst Francesco Pesole notes.

The AUD/JPY pair trades 0.3% higher to near 106.46 during the European trading session on Tuesday. The pair jumps higher as the Japanese Yen (JPY) underperforms its peers amid uncertainty surrounding Japan’s political outlook.

USD is likely to continue to rise; the level to watch is 158.90, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

New Zealand Dollar (NZD) could rise further; overbought conditions could limit any gains to a test of 0.5785. In the longer run, for the time being, NZD is likely to trade in a range between 0.5720 and 0.5805, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

Speculation that Prime Minister Takaichi may call a snap election has pushed Japanese government bond yields higher and sent the yen weaker, driving USD/JPY back toward 159.

Australian Dollar (AUD) is likely to trade in a range of 0.6685/0.6730. In the longer run, the current price movements are likely part of a range-trading phase between 0.6655 and 0.6745, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.

The USD/JPY pair revisits its one-and-a-half-year high of 159.00 during the European trading session on Tuesday.

Germany 5-y Note Auction climbed from previous 2.27% to 2.47%

EUR/JPY trades around 185.50 on Tuesday at the time of writing, up 0.50% on the day, extending its upward move for a third consecutive session, hitting a new multi-year high at 185.54 earlier in the day.

The US Dollar has found support at 0.7955, after retreating from highs near 0.8020 against the Swiss Franc on Monday.