Dollar declined in European trade on Tuesday against a basket of major rivals, extending losses for another session and on track for three-week lows as US 10-year treasury yields dipped as well.

Now investors await a batch of important US data later today in addition to remarks by Fed officials, which could provide fresh clues on the likely path ahead for monetary policies. 

The Index

The dollar index fell 0.2% to 103.61, with a session-high at 103.81, after closing down 0.2% on Monday, approaching three-week lows at 103.43. 

US Yields 

US 10-year treasury yields fell 0.6% on Tuesday, hovering near two-week lows and pressuring the greenback. 

The developments come as traders await a batch of important US data later today, which could offer fresh pricing for the likelihood of interest rate cuts in March, May, and June.

US Rates

Markets are now expecting a 2.5% chance for a Federal Reserve March rate cut, and a 20% chance for a May rate cut, and a 64% chance for a June cut. 

Investors now expect 75 basis points of total US rate cuts this year, down from 150 basis points in previous forecasts. 

Data

Now investors are waiting for a basket of important US data later this week, including GDP growth, unemployment claims and personal spending data, to gauge the likely path ahead for policies. 

Gold prices rose in European trade on Tuesday, approaching two-week high as the dollar declines against a basket of major rivals.

Now investors await important US data and Fed remarks today, which could provide fresh clues on the future of interest rates.

Gold Prices Today 

Gold prices rose 0.25% to $2036 an ounce, with a session-low at $2030, after closing down 0.25% on Monday on profit-taking, away from a two-week high at $2,041. 

The Dollar

The dollar index fell 0.15% on Tuesday, extending losses for the second session, on track for three-week lows at 103.43 against a basket of major rivals.

A weaker dollar makes greenback-denominated gold futures cheaper to holders of other currencies. 

The current decline comes as US 10-year treasury yields taper off as markets wait for more clues on the future of US interest rates.

US Rates 

Markets are now expecting a 2.5% chance for a Federal Reserve March rate cut, and a 20% chance for a May rate cut, and a 64% chance for a June cut. 

Investors now expect 75 basis points of total US rate cuts this year, down from 150 basis points in previous forecasts. 

Now investors  are waiting for a basket of important US data later this week, including GDP growth, unemployment claims and personal spending data, to gauge the likely path ahead for policies. 

The SPDR 

Gold holdings at the SPDR Gold Trust remained flat yesterday at 827.81 tonnes, the lowest since July 31, 2019. 

Sterling fell in European trade on Tuesday against a basket of major rivals, on track for the first loss in six days against the dollar away from three-week highs on profit-taking.

There are no important UK data this week that could change the odds of future UK interest rates, with investors focusing on US data released this week. 

GBP/USD

GBP/USD fell 0.1% to 1.2674, with a session-high at 1.2688, after closing up 0.1% on Monday, the fifth profit in a row, hitting a three-week high at 1.2710. 

UK Rates

Recent UK and inflation data is pointing to a likely UK rate cut in May, skipping March and April.

There’s less than a 15% chance for a Bank of England interest rate cut in March, with an over 50% chance for such a cut in May. 

Traders now expect 71 basis points on average in UK rate cuts this year, down from 134 basis points in previous forecasts. 

Bailey

Bank of England Governor Andrew Bailey said in recent remarks the BOE might not wait for 2% inflation before cutting interest rates, noting that the UK economy has already exited its recession. 

US Rates

Markets are now expecting a 2.5% chance for a Federal Reserve March rate cut, and a 20% chance for a May rate cut, and a 64% chance for a June cut. 

Now investors  are waiting for a basket of important US data later this week, including GDP growth, unemployment claims and personal spending data, to gauge the likely path ahead for policies. 

Solar energy operations and development expanded in recent years after decades of investments in sustainable energy sources, which lead to new cutting-edge solar panel technologies, with the pace only picking up, led by China and the US.

The International Energy Agency expects sustainable energy sources to contribute at least 80% of all new energy requirements in 2030, with solar energy alone accounting for half the increase. 

Indeed, the report expects the global manufacturing capacity to reach 1200 gigawatts of solar panels yearly by 2030. It should be noted that using only 800 gigawatts of solar energy by 2030 would reduce China’s coal reliance by 20%, with a 25% coal usage reduction in Latin America, Africa, and the Middle East. 

Solar energy investments spiked in the last decade, with global solar energy unit production expected to rise from 640 gigawatts in 2022 to 1200 gigawatts in the medium term. 

Currently, five countries dominate the industry, China, Vietnam, India, Malaysia, and Thailand, with China alone accounting for 80% of global manufacturing capacity. 

Nextracker is a company that tracks progress in solar energy projects, with CEO Dan Sugar stating that solar energy capacity is on track to double in size every two to three years as demand spikes inside and outside the US. 

Overall, the company expects the solar energy market to experience a compounded yearly growth of 26% in the next five years, and could even be the main source of electricity in the US by the next decade. 

Simultaneously, China is leading the world when it comes to solar energy, with both wind and solar energy sources surpassing coal stations this year in their energy production in China, with the government expecting wind and solar to account for 40% of total electricity production by the end of the year.