Forex Today: US Dollar clings to recovery gains in quiet calendar day

Here is what you need to know on Tuesday, December 6:

Following Monday's decisive rebound, the US Dollar Index clings to modest daily gains early Tuesday as investors adopt a cautious stance. The 10-year US Treasury bond yield stays in positive territory at around 3.6% in the European morning and US stock index futures trade flat on the day. October Goods Trade Balance will be the only data featured in the US Economic docket later in the day. Ivey November PMI from Canada and the GDT Auction from New Zealand will also be looked upon for fresh impetus. 

The data published by the ISM revealed on Monday that the business activity in the US service sector expanded at a strengthening pace in November with the Services PMI rising to 56.5 from 54.4 in October. This reading came in better than the market expectation of 53.1 and helped the US Dollar outperform its rivals in the second half of the day. Nevertheless, the CEM Group's FedWatch Tool shows that markets are still pricing in a nearly 80% probability of a 50 basis points (bps) Fed rate hike in December.