The U.S. dollar gained value at the start of Tuesday’s trading day in Europe, showing signs of recovery after significant declines over the previous weekend, while the Japanese yen continued to lose ground despite intervention warnings.

The dollar is stable after Friday’s fall

The dollar stabilized on Tuesday, showing small signs of recovery from last week’s losses after non-farm payrolls data failed to meet expectations, prompting market traders to turn their attention back to interest rate cuts by the Federal Reserve.

Traders believe that September stands out as a prime month for the Fed to begin its rate-cutting cycle.

This week’s economic calendar is fairly free, so attention will focus on interventions by various Fed policymakers.

For his part, Richmond Fed President Thomas Barkin has already stated that U.S. interest rates are currently at such ‘tight’ levels that they can help curb demand and stem ongoing inflationary pressures.

German industrial orders fall

In Europe, the EUR/USD is down 0.1% to 1.0760 after news that German exports rebounded in March, helped by strong U.S. and Chinese demand for German-made goods. However, a disappointing month for industrial orders dashed hopes for a quick economic recovery.

The European Central Bank has indicated an interest rate cut in June, however, there remains much uncertainty about what will happen to economic policy after that month.

The GBP/USD lost 0.2% to 1.2534 ahead of Thursday’s Bank of England meeting.

The yen has resumed its decline 

Despite Masato Kanda, the Japanese government’s top foreign exchange official, saying on Tuesday that action may be necessary against chaotic and speculative moves, the yen has resumed its downward path.

The AUD/USD is up 0.4% to 0.6599 after the Reserve Bank of Australia kept rates unchanged as expected and warned that inflation will still take longer to decrease in the near term.

However, the bank did not comment on any plans for further rate hikes, disappointing traders who anticipated such signals, especially after first-quarter inflation exceeded forecasts.