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USD: Inflation and housing data the focus in the US today.   The headline inflation rate is seen falling to 1.6% (from 2.0%), with core prices holding steady at 2.0%.

GBP: Inflation data is the main risk for sterling. If anything, the risks are to the upside from the expected 2.8% headline reading.   This would put some fresh downward pressure on the pound, which has so far held up relatively well given the volatility being seen elsewhere. More:  GBP/USD Retreats from Key Resistance

EUR: The ZEW data the bigger focus for the single currency, especially for Germany.   Sentiment is seen falling from the March reading of 48.5 (to 41.0), with a bigger fall likely to weigh on the euro. See how to trade ZEW with EUR/USD.

Idea of the Day

Although we’ve seen a modest recovery in the Asia session, the collapse in the gold price over the past two sessions could well have further to run (see Golden Rules Gone for more).   The issue is that, as much as there can be rules for valuing gold, they’ve all pretty much broken down in the past few months and at the moment we’ve not seen anything else to replace them. For example, the ‘currency debasement’ argument does not have legs, the major central banks having expanded their balance sheets by a further 12% over the past 6 months, whilst gold prices have fallen by 16% over the same period.   The tough times for Gold are set to continue.

More Gold bugs busted?

Latest FX News

AUD: The latest RBA minutes were still keeping the door open to further rate cuts.   The Aussie was already under pressure on Monday, briefly touching 1.03 by the end of the day, allowing the minutes to be largely ignored. The price action on gold is also undermining higher beta currencies such as the Aussie.

JPY:  The Asia session has seen a modest recovery in USDJPY from the low at 95.80.   For now, the momentum for a sustained push above 100 appears to be lacking.

EUR: The single currency, at least in EURUSD terms, is a bystander to the volatility being seen elsewhere, with hold above 1.30 the initial focus.