Forex Today: Dollar steadies, eyes on European data, US PCE inflation report

Here is what you need to know on Friday, October 29:

The dollar faced heavy selling pressure on Thursday after the US Bureau of Economic Analysis' first estimate showed that the US economy grew by only 2% in the third quarter. The shared currency outperformed its rivals as the European Central Bank adopted a cautious tone regarding inflation expectations. The greenback seems to have found its footing in the early European session as investors await GDP, inflation data for the euro area and German growth figures. Later in the day, the PCE inflation report and the UoM Consumer Sentiment Index will be featured in the US economic docket.

The US Dollar Index (DXY) fell more than 0.5% on Thursday as the disappointing GDP data caused investors to reassess the Federal Reserve's tapering timeline. Currently, the DXY is consolidating its losses around 93.50. 

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Wall Street: Major equity indexes in the US registered impressive gains on Thursday as investors remain hopeful for the Fed to continue to support the economy for longer than expected. US stocks futures are, however, losing between 0.3% and 0.9% early Friday, suggesting that there could be a deep correction ahead of the weekend.

Following a four-day slump, the benchmark 10-year US Treasury bond yield rose more than 2% on Thursday and continues to push higher on Friday, helping the dollar show some resilience against its rivals. 

EUR/USD gained more than 70 pips on Thursday and reached its strongest level in a month at 1.1693. Although ECB President Christine Lagarde voiced her opposition to the market pricing of an ECB rate hike, she acknowledged that high inflation is likely to last longer than they initially anticipated. The shared currency could regather its strength in case Friday's data show that the economic activity in the euro area remains healthy in the third quarter. For now, the pair is moving sideways 

GBP/USD stays below 1.3800 following Thursday's recovery. Renewed Brexit concerns could make it difficult for the British pound to attract investors. BBC reported late Thursday that France seized a British trawler and fined another one amid an ongoing spat regarding post-Brexit fishing rights.

USD/CAD failed to capitalize on the broad USD weakness as falling crude oil prices weighed on commodity-related loonie. August GDP data from Canada will be looked upon fresh impetus.

Once again, gold failed to clear $1,800 on Thursday capped by rising US T-bond yields. Last week, XAU/USD volatility increased into London fix and a similar action could be witnessed toward the end of the European session.

Cryptocurrencies: Bitcoin managed to reclaim $60,000 on Thursday and looks to regather bullish momentum. Ethereum is treading water near record-highs and a break above $4,400 could trigger sharp fluctuations.