EUR/USD
The EUR/USD pair remains on the back foot through the Asian session on Friday and currently trades just above mid-1.1700s, well within striking distance of a nearly one-month low set the previous day.
The incoming US macro data pointed to a remarkably resilient labor market. Adding to this, the January FOMC meeting Minutes and hawkish comments from Federal Reserve (Fed) officials forced investors to pare their bets for more aggressive policy easing. This, along with rising geopolitical tensions, assists the safe-haven US Dollar (USD) in preserving its recent strong gains to the highest level since January 23, which, in turn, continues to weigh on the EUR/USD pair.
GBP/USD
The Bank of England (BoE) held rates at 3.75% at its February meeting in a tight 5-4 vote, with four members pushing for a 25 basis point cut. This week’s data has strengthened the case for easing: Tuesday’s labor report showed unemployment climbing to 5.2% with payrolls falling by 30K, and Wednesday’s CPI confirmed headline inflation dropped to 3% from higher levels while the Retail Price Index fell to 3.8%. The softening data keeps a March rate cut firmly in play.
USD/JPY
The USD/JPY pair gains positive traction for the third straight day and climbs to over a one-week top, around the 155.35-155.40 region on Friday. Data released early today showed that Japan’s key inflation gauge eased to the slowest pace in two years, tempering expectations for an immediate policy tightening by the Bank of Japan (BoJ). Apart from this, concerns about Japan’s fiscal health undermine the Japanese Yen (JPY) and act as a tailwind for the currency pair.
AUD/USD
The RBA’s February rate hike to 3.85%, the first in over two years, continues to underpin the Australian Dollar after this week’s minutes flagged elevated inflation risks and left the door open for further tightening. Thursday’s January employment data reinforced that stance, with the unemployment rate holding at 4.1% (below the expected 4.2%) and the number of unemployed falling for a fourth consecutive month.
NZD/USD
NZD/USD has pared its recent gains registered in the previous session, trading around 0.5950 during the Asian hours on Friday. The technical analysis of the daily chart signals an emergence of the bearish reversal as the pair price is positioned below the lower ascending channel boundary. Additionally, the 14-day Relative Strength Index (RSI) at 48 (neutral) shows fading momentum after prior overbought readings.
USD/CAD
The USD/CAD pair clings to Wednesday’s gains near 1.3700 during the European trading session on Friday. The Loonie pair shows strength as the US Dollar (USD) trades broadly firm, following the release of the Federal Open Market Committee (FOMC) minutes of the January policy meeting on Wednesday.
USD/CHF
USD/CHF extends its winning streak for the fifth successive session, trading around 0.7760 during the Asian hours on Friday. The pair holds firm as the US Dollar (USD) draws support after the US Department of Labor (DOL) reported that Initial Jobless Claims declined to 206K for the week ending February 14, down from the prior week’s revised 229K and below the 225K consensus forecast. Market participants now turn their focus to Friday’s preliminary US Q4 Gross Domestic Product (GDP) and Personal Consumption Expenditures (PCE) data for fresh direction.
CRUDE OIL
Oil prices rose on Friday, headed for their first weekly gain in three, on growing concerns a conflict may erupt between the U.S. and Iran, after Washington said Tehran will suffer if it does not agree a deal on its nuclear activity in a matter of days.
Gold (XAU/USD) gains some positive traction for the third consecutive day on Friday. The upside potential, however, seems limited amid the mixed fundamental backdrop. Moreover, traders might opt to wait for the key US macro releases – the Advance Q4 GDP report and the Personal Consumption Expenditures (PCE) Price Index – before placing fresh directional bets. The crucial data will play a key role in influencing expectations about the US Federal Reserve’s (Fed) rate cut path. This, in turn, will drive the US Dollar (USD) and provide some meaningful impetus to the non-yielding yellow metal. Any information provided therein are indicative and subjective to the technical analysis method or trading patterns used and the timing of their release. Those are provided as general market information and/or market commentary and/or the publication of market/factual data and should not be construed as containing personal and/or other investment recommendation, and/or to be Investment Advice or independent Investment Research. As such, the legal and regulatory requirements in relation to independent
