USD/CAD pair faces selling pressure

Key Movers

The dollar index (DXY) is trading below 104.120, falling as much as 0.55%, and nearing a month low of 103.67. The US dollar weakened today as investors anticipated the Federal Reserve will be less inclined to raise interest rates after policymakers intervened to mitigate the damage from the sudden failure of Silicon Valley Bank (SVB). The recent market unrest caused by the SVB collapse has led investors to believe that the Fed will no longer raise interest rates by 50 basis points this month. Investors are now turning their focus toward Tuesday's inflation data to determine how hawkish the Fed will be.

EUR/USD advances past the 1.0700 mark as it hits a 4-week high. No major economic data at the EU level will be released until Thursday when the European Central Bank (ECB) will meet to announce its policy decision. A 50 basis point hike is still anticipated however the question remains of how hawkish the ECB will be, and if further rate hikes are to come.

GBP/USD was up 0.4% as it trades above 1.2089. There is no UK economic data for today.  Bank of England monetary policy committee member, Swati Dhingra, is scheduled to speak later today to provide further insight into last week’s decision to keep rates unchanged.