Forex today: markets snap out of risk aversion stupor as trade war fears recede

Forex today bid risk assets broadly higher and sent the US Dollar and the safe-haven Yen down against the major currency blocs as risk appetite surged in Monday's action. Wall Street equities bounded higher for the best day in two and a half years and the Dow Jones Industrial Average experienced its third-biggest point gain in history.

Trade war tensions have eased this week as both the US and China appear to be will to work together to reach agreeable trade terms and find a solution to the current tariff threat exchange that has plagued market participants in recent weeks. US Treasuries also traded sedately, with the 2-year note hitting near 2.27% and the 10-year bond trading at 2.85% to end the day.

Yen retreats into March's range as markets go risk-on

The US session saw a broad-based rebound in the markets after both Asia and Europe closed on a soft note in Monday's action, and the Euro traded to a one-month high and the Sterling lifted to match with Brexit concerns also fading into the background, though the EU and the UK still haven't hammered out the details on what a post-Brexit scenario is going to look like. The Aussie and the Kiwi both climbed against the Greenback as well, and the biggest loser in Monday's trading was the Japanese Yen, sending the USD/JPY pair back into 104.80 after declining to a fourteen-month low last week.

Market sentiment is holding on the risk side heading into the next session, and a quiet macro calendar coupled with a shortened week thanks to the Easter weekend coming up sees little impactful releases until the US GDP figures on Wednesday and European CPI data on Thursday.

Key headlines heading into Tuesday:

US Dollar Index under pressure as US-China tension ease

Moody's: Terms of post-Brexit transition deal are credit positive, but uncertainties remain

US equities came back, trim half of last week's losses

China: not defenseless in a trade war, likely to make concessions - BBH