Forex Today: BoJ maintains status quo, US-Iran uncertainty persists

Here is what you need to know on Tuesday, April 28:

Market mood sours following Monday's choppy action as optimism about an end to the conflict between the United States (US) and Iran wanes. In the second half of the day, the US economic calendar will feature the weekly ADP Employment Change data and the Conference Board's Consumer Confidence Index for April.

Iran reportedly sent a proposal to end the war and open the Strait of Hormuz on Monday. Citing sources familiar with the discussions, CNN reported that US President Donald Trump signaled that he was unlikely to accept Iran's proposal, as reopening the strait without resolving questions over Iran’s nuclear enrichment could remove an important leverage in negotiatons. The barrel of West Texas Intermediate (WTI) gains about 2% on the day and trades slightly below $97 in the European morning. Meanwhile, the US Dollar (USD) Index stays in positive territory above 98.50 and US stock index futures trade mixed.

The Bank of Japan (BoJ) left its monetary policy settings unchanged following the April meeting, as anticipated. In its quarterly Outlook Report, the BoJ revised the median forecast for the core Consumer Price Index in the fircal year of 2026 to 2.8% from 1.9% in January's report. BoJ Governor Kazuo Ueda said in the post-meeting press conference that real interest rates are at significantly low levels and added that they will "continue to raise policy rate, adjust the degree of monetary accommodation according to economic activity, prices and financial conditions." After dropping to a fresh weekly low below 159.00 with the immediate reaction to the BoJ policy decisions, USD/JPY staged a rebound and was last seen trading flat on the day, slightly below 159.50.

Following the bullish action seen in the European session on Monday, EUR/USD erased a large portion of its daily losses in the American session. The pair stays under modest bearish pressure and trades in the red near 1.1700 in the European morning on Tuesday.

AUD/USD struggles to preserve its bullish momentum after rising more than 0.5% on Monday and trades near 0.7170. In the Asian session on Wednesday, CPI data from Australia will be watched closely by market participants.

GBP/USD declines toward 1.3500 in the European morning on Tuesday after closing virtually unchanged on Monday. According to The Times, the United Kingdom (UK) House of Commons will vote on Tuesday on whether to launch an investigation through the Committee of Privileges to determine if Prime Minister Keir Starmer misled lawmakers over the appointment of former US ambassador Peter Mandelson.

Gold comes under renewed selling pressure early Tuesday and trades at its lowest level in three weeks below $4,650.