06:16 AM EDT, 06/11/2024 (MT Newswires) -- US dollar exchange rates rose broadly during early European trade on Tuesday as risky assets softened almost across the board ahead of eagerly awaited updates on US inflation and Fed policy slated for Wednesday.

The US dollar rose against all counterparts in the G10 basket except for the Swiss franc and British pound sterling with its largest gains coming in relation to the high-beta Norwegian krone, Swedish krona and Australian dollar.

Dollar gains were similarly widespread in relation to the broader G20 basket where the Mexican peso was the only currency to rise against the greenback in another quiet session for economic data with little newsflow to occupy markets.

Risky assets like stocks were softer almost across the board in Europe and Asia while government bond markets were bid with yields falling except in some European markets like France, Italy and Spain where local politics continued to weigh.

With the US calendar devoid of meaningful data on Tuesday, market attention is likely to remain fixed on Wednesday morning's US May inflation data and the Federal Reserve policy decision due later in the afternoon.

A quick summary of foreign exchange activity heading into the European lunch hour and US open;

In Europe, EUR/USD was quoted 0.13% lower around 1.0749 after falling from overnight highs near 1.0773 to remain under pressure near Monday's intraday lows around 1.0732. The single currency had benefited previously but only briefly when President Christine Lagarde told a group of European newspaper reporters that interest rates are not on a linear path downward and that the ECB could hold them at current levels for a period of time as it awaits further relevant economic data. The next calendar event for the euro is the release of final German CPI and US inflation figures on Wednesday.

Elsewhere in Europe, GBP/USD was quoted 0.04% higher around 1.2731, making sterling the outperformer among G10 currencies, after recovering off the intraday lows around 1.2713 seen after the Office for National Statistics said the unemployment rate rose to 4.4% in April, its fourth consecutive increase.

However, wage growth accelerated to 5.9% when bonuses are included, up from 5.7%, and remained steady at 6% if bonuses were excluded. The continued strong growth in pay packets makes it less likely the Bank of England will cut interest rates in August. The next calendar highlight for sterling is Wednesday's release of April GDP data in the UK and subsequent reading of May CPI in the US.

In Asia, USD/JPY was quoted 0.12% higher around 157.23, up from Monday's lows around 156.73 but down from European morning highs around 157.40. The yen was sitting around the middle of the G10 rankings in European trade after overlooking a 4.2% YoY increase in machine tool orders for May announced by the Japan Machine Tool Builders' Association during Asian trade. The next calendar highlight for the yen is Friday's Bank of Japan policy decision, though the currency will also be among the most sensitive to Wednesday's US inflation figures and subsequent Fed policy decision.

Back in North America, USD/CAD was quoted 0.11% higher around 1.3774 after lifting off overnight lows around 1.3754 and remaining buoyant, near two-month highs around 1.3780. The Canadian dollar was sitting in the lower half of the G10 rankings despite broad gains for the US dollar and Mexican peso. The next calendar highlight for the Loonie is a Wednesday speech from Bank of Canada Governor Tiff Macklem but the currency will also be sensitive to Wednesday's inflation reading in the US and the subsequent Fed policy decision.