The USD/JPY pair jumps to a near three-week high of 157.35 during the early Asian session on Tuesday. The US Dollar (USD) strengthens against the Japanese Yen (JPY) on the stronger-than-expected US economic data. Bank of Japan (BoJ) Governor Kazuo Ueda is set to speak later on Tuesday.

Commerzbank’s Charlie Lay and Moses Lim highlight that the People’s Bank of China has removed the 20% reserve requirement on foreign currency forwards, reducing the cost of short CNY positions. They argue this likely aims to slow CNY appreciation even as USD/CNY and USD/CNH have recently fallen.

GBP/USD fell around one-half of one percent on Monday, briefly sliding to an eleven-week low around 1.3310 in early trade before staging a mid-session recovery to settle close to the 1.3400 handle.

The AUD/JPY recovers from earlier losses, advances some 0.38% on Tuesday even though risk aversion is ruling the financial markets as tensions in the Middle East had risen. Hawkish comments of RBA’s Governor Bullock propel the Aussie Dollar higher. At the time of writing, the cross-trades at 111.62.

GBP/JPY rises during the North American session up by 0.24% after recoverying from hitting daily lows of 209.35 amid risk aversion spurred by the Middle East conflict between the US and Iran. At the time of writing, the cross-pair trades at 210.98, about to overcome the 211.00 hurdle.

The Swiss Franc was the standout safe-haven performer on early Monday trading, rallying sharply against the Euro and most major currencies as the US-Israeli military strikes on Iran triggered a broad flight to safety.

The Australian Dollar register loses versus the Greenback following over-the-weekend developments, which triggered a flight to safety, weighing on the AUD/USD pair. At the time of writing, it trades at 0.7083, down 0.37%.

NZD/USD trades under pressure on Monday as the New Zealand Dollar (NZD) weakens against the US Dollar (USD) amid escalating geopolitical tensions in the Middle East.

The Euro (EUR) edges lower against the US Dollar (USD) on Monday, with EUR/USD sliding more than 1% as investors rotate into the safe-haven Greenback amid escalating geopolitical tensions in the Middle East.

USD/CHF trades around 0.7800 on Monday at the time of writing, up 1.50% on the day, as the US Dollar (USD) extends gains that were already in place before the release of US manufacturing data.

The Canadian Dollar (CAD) trades on the back foot against the US Dollar (USD) on Monday as the US-Iran war sparks a risk-off mood in global markets, boosting demand for the safe-haven Greenback and weighing on risk-sensitive currencies.

The GBP/USD retreats some 0.49% on Monday amid risk aversion sponsored by the conflict in the Middle East between the alliance of the US and Israel against Iran. Consequently, safe-haven peers like the US Dollar remains bid in the day, hence weighed on the pair.

USD/JPY trades around 157.50 on Monday at the time of writing, up 0.84% on the day, moving closer to the February high at 157.66 and maintaining a bullish tone supported by the strength of the US Dollar (USD).

GBP/JPY rebounds sharply on Monday after a bearish gap-down open, as heightened volatility sweeps across the FX market following joint US-Israeli strikes on Iran over the weekend.

MUFG’s Teppei Ino notes that the Dollar’s advance against the Japanese Yen has stalled after the LDP’s landslide Lower House victory, as markets had already priced in the so‑called Takaichi trade and prior intervention warnings.

EUR/GBP trades lower around 0.8750 on Monday at the time of writing, down 0.23% on the day, after two consecutive days of gains. The cross is facing profit-taking as the Euro (EUR) is weighed down by weaker-than-expected consumption data in Germany.

The United States (US) Institute of Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) data for February is due for release today at 15:00 GMT.

The GBP/USD pair claws back its significant early losses during the European trading session on Monday, but is still 0.6% down to near 1.3400.

ING’s Chris Turner says higher energy prices are forcing investors to reassess optimism on European industry and the Euro. With Investors have been overweight the Euro and European assets, EUR/USD is coming under pressure.

The NZD/USD pair holds early losses driven by the ongoing war between the United States (US) and Israel, trades 0.75% lower to near 0.5950 during the European trading session on Monday.

Rabobank’s Jane Foley argues that despite questions over the Dollar’s safe haven role, liquidity and global usage should preserve its crisis function.

EUR/USD declines nearly 1%, trading around 1.1740 during the European hours on Monday.

Eurozone HCOB Manufacturing PMI meets expectations (50.8) in February

Germany HCOB Manufacturing PMI registered at 50.9 above expectations (50.7) in February

France HCOB Manufacturing PMI came in at 50.1, above expectations (49.9) in February

Italy HCOB Manufacturing PMI came in at 50.6, above forecasts (49.2) in February

Switzerland SVME - Purchasing Managers' Index came in at 47.4, below expectations (50) in February

The AUD/USD pair trades 0.85% lower to near 0.7050 during the European trading session on Monday. The Aussie pair plummets as risk-off market sentiment amid the United States (US)-Iran war has weighed heavily on the Australian Dollar (AUD).

Scotiabank strategists Shaun Osborne and Eric Theoret, notes the Canadian Dollar is ended the week slightly stronger versus the US Dollar, with cross-currents from equities and crude.

EUR/JPY pares daily losses but remains in the negative territory, trading around 184.00 during the early European hours on Monday. The technical analysis of the daily chart shows a consolidation phase as the currency cross remains within the horizontal channel.