Currency markets began to show erratic movements at the opening of the European session, with major currencies again depreciating and the USD rising slightly.
This can be seen in the Aussie and New Zealand dollars which recorded a significant drop compared to the greenback when the market entered the European session.
This volatile movement is indeed expected considering that today is the last day of trading for this week, March and the first quarter of 2023 which may see profit taking activity.
Next week will be an important week for both currencies as the Reserve Bank of Australia (RBA) and New Zealand (RBNZ) policy meetings take place.
The US dollar, despite rising, is still hovering around its weekly low where the dollar index is trading at 102.37 against a group of major currencies.
Investors' main focus is now on the release of US consumer personal expenditure (PCE) data in the New York session.
Meanwhile, the euro also retreated slightly but remained trading firmly around its weekly high against the USD ahead of the release of European Zone inflation data.
Meanwhile, the pound pared its gains, falling slightly from its 2-month high against the US dollar.
The final reading of the UK's gross domestic product (GDP) showed the economy grew 0.6% year-on-year in the fourth quarter of 2022, better than expected to remain at 0.4% growth.
Meanwhile, the yen remained gloomy after data showed Tokyo inflation fell slightly from the previous reading in March, at 3.2% versus 3.3%.
The Canadian dollar remained steady at a 5-week high against the greenback, with investors now awaiting the release of Canadian GDP data in the New York session.
