Forex Today: Focus remains on the Aussie ahead of data, after RBA hike

 After Tuesday's 25 basis points rate hike, Australia will report Q1 GDP. RBA Governor Lowe will deliver a speech. Chinese trade data is due, and in Japan, the Leading Economic Index will be released. Later on Wednesday, German Industrial Production data is due. The key event during the American session will be the Bank of Canada decision.

Here is what you need to know on Wednesday, June 7:

The US Dollar posted mixed results on Tuesday in a cautious market ahead of a crucial week. The USD Dollar Index rose 0.15% but was unable to break the 104.40 area again. US Treasury yields held relatively steady. There are no Federal Reserve speakers ahead of next week's FOMC meeting. The US central bank is expected to pause its hiking cycle; however, the May Consumer Price Index number next Tuesday is seen as a determinant.

April Eurozone Retail Sales and German Factory Orders came in below expectations. On Wednesday, more data is due with German industrial production. EUR/USD dropped on Tuesday but remains below but near 1.0700. Risks are tilted to the downside, and support awaits at 1.0650.

GBP/USD dropped again but managed to close above 1.2400. EUR/GBP fell modestly to the 0.8600 area.

On Tuesday, the Australian Dollar was the top performer in the currency markets, following the Reserve Bank of Australia's (RBA) decision to raise the cash rate by 25 basis points to 4.1%. This marks the second consecutive hike, defying market consensus. RBA Governor Lowe will speak at the Morgan Stanley Australia Summit. 

AUD/USD posted the highest daily close since mid-May, above 0.6650; the pair has gained almost two hundred pips from a week ago. On Wednesday, Australia is scheduled to release its Q1 GDP data, which is expected to show a positive growth rate of 2.7%. This is an improvement from the previous quarter's growth rate of 2.4%.

USD/CAD posted the lowest close in a month near 1.3400. On Wednesday, the Bank of Canada will announce its decision. The BoC is expected to keep the key rate at 0.5%, but analysts warn of the risk of a hawkish surprise. A pause may weigh on the Loonie.

It was a quiet session for metals, with Gold moving sideways around $1,960 and Silver around $23.65. Cryptocurrencies rebounded on Tuesday amid increasing volatility triggered by the action taken by the US Securities and Exchange Commission (SEC), which sued the crypto exchange Coinbase. Bitcoin gained more than 5%, rising toward $27,000.

The Turkish Lira continues to depreciate, even after President Erdogan appointed Simsek as the new Treasury and Finance Minister. USD/TRY climbed to a fresh record high near 21.50.