Makro

EUR/JPY pares its daily losses, still remaining in the negative territory and trading around 185.10 during the European hours on Tuesday. The currency cross remains steady following the release of the German ZEW Survey data.

TD Securities economists diverge from consensus by expecting the European Central Bank (ECB) to hold rates in June. They stress the absence of clear second-round effects, anchored inflation expectations, and softening confidence and growth.

Dow Jones futures are steady around 49,800 during the European hours on Tuesday, ahead of the United States (US) regular opening. Meanwhile, the S&P 500 decline 0.35% to near 7,410, and the Nasdaq 100 futures inch lower 0.77% toward 29,200.

Here is what you need to know on Tuesday, May 12:

European Central Bank (ECB) Governing Council Member and President of the Deutsche Bundesbank, Joachim Nagel, said during the European trading session on Tuesday that the baseline includes two interest rate hikes in the near term.

BNY strategists John Velis and David Tam argue that resilient United States (US) data and likely elevated inflation prints make it harder to justify Federal Reserve (Fed) rate cuts this year.

ING’s Commodities Strategist Ewa Manthey explains why Gold has dropped about 12% since the Iran conflict began, despite its reputation as a safe haven. She argues the move reflects macro headwinds from higher Oil prices, stronger US Dollar (USD) and elevated real yields.

United States (US) Treasury Secretary Scott Bessent confirmed through a post on X, formerly known as Twitter, that the US and Japan took some actions together against excessive volatility in currency markets.

Commerzbank analysts note the US Dollar Index (DXY) inched up to 97.96 as markets consolidated and prepared for United States (US) Consumer Price Index (CPI).

The Australian Dollar (AUD) trades cautiously against its major currency peers, is 0.23% down to near 0.7230 against the US Dollar (USD), during the late Asian trading session on Tuesday. The antipodean will likely remain volatile ahead of the Australian Budget release for 2026 at 09:30 GMT.

Asian stock markets trade mixed on Tuesday as investors remain on edge amid fading hopes for a US-Iran peace deal and de-escalation of tensions in the Middle East.

The US Bureau of Labor Statistics (BLS) will publish the April Consumer Price Index (CPI) data on Tuesday.

EUR/JPY extends its gains for the fourth successive day, trading around 185.40 during the Asian hours on Tuesday. The currency cross appreciates as the Japanese Yen (JPY) struggles following the disappointing release of Japan's Household Spending data.