GBPUSD daily

The euro, pound, kiwi and Australian dollar are all at or near session highs against the US dollar.

The catalyst for the US dollar selling today isn't entirely unclear. The risk tone has improved but the S&P 500 is still down 0.3%. It's been a battle between the bulls and bears all day.

Earlier, the dip in Treasury yields was a good explanation for the decline in the dollar and that still holds some weight but 10-year yields have rebouned to 2.846% from a low 2.77% with no discernible dollar bounce.

Zooming out, the dollar has been a fantastic trade but there's a growing sense that other global central banks may do more. The ECB's Knot floated a 50 bps hike this week and the BOE is under heavy pressure to do more to tame inflation.

The spot I'm watching most-closely in the day ahead is USD/JPY with the Japanese CPI report coming up. USD/JPY has begun a bit of a retracement after a nine-week run higher.

Ultimately, the dollar has had a great run so a retracement isn't exactly a red flag but it's an interesting emerging dynamic.