GBP/USD subdued around 1.1840s after printing a YTD low around 1.1800.

GBP/USD trims Tuesday’s losses after hitting a YTD low of 1.1802.

Labor market data in the United States portrays a tight labor market; focus shifts to Friday’s Nonfarm Payrolls.

GBP/USD stays around 1.1840s, following hawkish remarks by the US Federal Reserve (Fed) Chair Jerome Powell. Powell’s two-day testimony before the US Congress will conclude on Wednesday at the US House of Representatives, with market participants expecting him to remain hawkish. Therefore, the GBP/USD is exchanging hands at 1.1843, gaining 0.10%.

Federal Reserve Chair Powell testifies at the US House of Representatives

The GBP/USD will likely remain at familiar levels, as the market has priced in Powell’s hawkishness on Tuesday. On Wednesday, labor market data revealed in the United States (US) economic docket reinforced the Federal Reserve’s view about the tightness of the labor market. February’s ADP report revealed that the US private sector added 242,000 jobs, more than the expected 200,000.

Later, job openings for January in the United States dropped less than estimates, as shown by the JOLTS report. Job openings, a measure of labor demand, decreased to 10.8M. However, data came above forecasts of 10.5M. Given the backdrop, Jerome Powell and Co. could justify higher rates, which could be confirmed by next Friday’s US Nonfarm Payrolls report.

The US Dollar Index (DXY) has trimmed some of its losses and is down 0.08%, at 105.535, after diving to 105.365. US Treasury bond yields, namely the 10-year, are still pressured, falling two and a half bps to 3.942%.At the time of writing, Fed Chair Jerome Powell is testifying at the US House of Representatives and has managed to stay hawkish as his previous appearance in the US Senate.

On the United Kingdom (UK) front, Bank of England (BoE) policymakers had been crossing the wires. Swati Dhingra said on Wednesday that risks of overtightening “pose a more material risk at this point, through potential negative impacts from increased borrowing costs and reduced supply capacity going forwards.” Of note, she voted for no change in the last two meetings.

EUR/USD holds above 1.0550 as Powell testifies

EUR/USD clings to modest daily gains above 1.0550 in the American session on Wednesday. In the second day of his semi-annual testimony, FOMC Chairman Jerome Powell noted that they have not made a decision about March meeting, causing the US Dollar to lose some interest.

EUR/USD News 

USD/CAD edges higher toward 1.3800 as BoC leaves key rate unchanged at 4.5%

USD/CAD trades at its highest level since early November at around 1.3780 in the American session on Wednesday. As expected, the Bank of Canada announced that it left its policy rate unchanged at 4.5%, making it difficult for the Canadian Dollar to gather strength.

USD/CAD News 

Gold rebounds to $1,820 as US yields decline

Gold price managed to stage a rebound and turned positive on the day near $1,820 in the second half of the day on Wednesday. The benchmark 10-year US Treasury bond yield is down nearly 1% on the day during FOMC Chairman Jerome Powell’s testimony, helping XAU/USD stretch higher.

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