Here's what you need to know for Wednesday, March 30:

Renewed optimism for a diplomatic solution to the Russia-Ukraine conflict led risk flows to dominate financial markets Tuesday and the dollar to lose interest. As the focus shifts from the US to ADP Employment Change and Q4 GDP data, the dollar is only on one leg early Wednesday. The European report will also include the German inflation report and eurozone sentiment figures. In addition, investors will follow geopolitical developments closely.

Breaking News in The War

After Tuesday's talks, the Russian Defense Ministry announced that it would reduce military activity around Kyiv and Chernihiv. Also, one of the Ukrainian negotiators noted that they have made enough progress to hold a meeting between Ukrainian President Volodymyr Zelenskyy and Russian President Vladimir Putin.

The Pentagon said earlier on Wednesday that Russia was moving troops around Kyiv rather than withdrawing them. On a similar note, British military intelligence argued that Russian forces had returned to Belarus to reorganize and resupply.

In the Stock Exchange Today

Market action is yet to indicate a significant negative change in sentiment, with US stock index futures trading sideways throughout the day. The US Dollar Index, which lost 0.7% on Tuesday, is already down 0.3% near 98.00 and the 10-year US T-bond yield is down 1.3% at 2.37%.

During Asian stock hours, USD/JPY dropped sharply to 121.00. In response, the Bank of Japan (BOJ) announced that it conducted an emergency market operation by offering to buy 10-25-year Japanese government bonds worth JPY 100 billion, but the pair failed to make a convincing recovery. Commenting on recent market movements, BOJ Chairman Kuroda noted that the cost of buying US dollars to buy commodities is one of the main factors behind the JPY's recent weakness.

EUR/USD hit a more than ten-day high of 1.1137 on Tuesday, ending a four-day streak. The pair is holding on to modest daily gains above 1.1100 early Wednesday.

GBP/USD climbed above 1.3150 during European trading hours on Tuesday, but erased daily gains to close sideways near 1.3100. The pair is currently trading in positive territory near 1.3120.

Gold fell to $1,890 on Tuesday, its weakest level since late February. In light of the results of US Treasury yields, XAU/USD reversed direction during the American session and continued to rise early Wednesday. The pair was last seen posting modest daily gains above $1,920.

Despite the improving market mood, Bitcoin lost its bullish momentum on Tuesday and posted small daily losses. BTC/USD is trading sideways around $47,500 so far on the day. Ethereum rallied to its highest level since early January at $3,483 on Tuesday before moving into a consolidation phase around $3,400 on Wednesday.

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