Forex Today: US Dollar pushes higher ahead of key US data, Fed policy decisions

Here is what you need to know on Wednesday, May 1:

The US Dollar (USD) preserves its strength on the first trading day of May as investors gear up for key data releases and the Federal Reserve's monetary policy decisions. The ADP will release the private sector employment report for April ahead of the US Bureau of Labor Statistics's JOLTS Job Openings data for March and the ISM Manufacturing PMI Survey for April. The Fed's policy announcement will be followed by Chairman Jerome Powell's press conference. European markets will remain closed in observance of the Labor Day holiday.

ADP Employment Change Preview: US private sector expected to add 179K new jobs in April.

The USD registered impressive gains against its major rivals on Tuesday, boosted by the latest data releases and safe-haven flows. The Employment Cost Index rose 1.2% in the first quarter of the year. This reading followed the 0.9% increase recorded in the previous quarter and came in above the market expectation of 1%. Meanwhile, Wall Street's main indexes suffered heavy losses on Tuesday, with the Nasdaq Composite Index falling nearly 2%. The USD Index rose over 0.6% on Tuesday and was last seen fluctuating in positive territory at around 106.50. In the meantime, the benchmark 10-year US Treasury bond yield stays near 4.7% after gaining more than 1% on Tuesday.

After spending the first half of the day above 1.0700 on Tuesday, EUR/USD turned south in the American session and registered its lowest daily close in a week. The pair continues to edge lower early Wednesday and was last seen trading at around 1.0650.

GBP/USD came under bearish pressure and lost over 0.5% on Tuesday, erasing Monday's gains in the process. The pair struggles to stage a rebound in the European morning and trades in the red at around 1.2470. 

The data from New Zealand showed that the Unemployment Rate climbed to 4.3% in the first quarter from 4%. The Employment Change for this period arrived at -0.2% following the 0.4% increase recorded in the last quarter of 2023. Pressured by the broad USD strength and disappointing data, NZD/USD lost 1.5% on Tuesday and was last seen trading below 0.5900.

USD/JPY posted strong gains on Tuesday and retraced a large portion of the decline that was triggered by Japan's suspected intervention in currency markets at the beginning of the week. At the time of press, the pair was trading in a tight channel slightly below 158.00.

Gold lost more 2% on Tuesday and dropped to its lowest level in over three weeks below $2,300. XAU/USD stays in a consolidation phase above $2,280 in the European morning.