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17.02.2023 Market Report


EUR/USD is dropping toward 1.0600, at its lowest level in six weeks in early Europe this Friday. The pair is undermined by a broadly firmer US Dollar amid rallying US Treasury bond yields and risk aversion. ECB and Fed speeches eyed. 


GBP/USD stands on slippery grounds near 1.1950 in the early European morning. Expectations of weak UK Retail Sales data and broad-based US Dollar strength are weighing negatively on the currency pair. 


The USD/JPY pair regains positive traction following the previous day’s modest downtick and rallies back closer to the YTD peak during the Asian session on Friday. The pair currently trades around the 134.70-134.75 region and seems poised to prolong its uptrend witnessed since the beginning of this month. The US Dollar buying remains unabated on the last day of the week amid firming expectations that the Fed will stick to its hawkish stance, which, in turn, acts as a tailwind for the USD/JPY pair. In fact, the USD Index, which tracks the Greenback against a basket of currencies, hits a fresh six-week low as investors now seem convinced that interest rates are going to remain elevated for longer.


The AUD/USD pair extends this week’s retracement slide from the 0.7030 area and continues losing ground for the third successive day on Friday. The downward trajectory drags spot prices to the lowest level since January 6 during the Asian session and is sponsored by broad-based US Dollar strength.


NZD/USD bears keep the reins for the fourth consecutive day as the quote drops to the lowest level since early January, following a U-turn from the weekly top on Tuesday. That said, the Kiwi pair sellers attack 0.6220-15 support during early Friday in Europe. Earlier in Asia, New Zealand Financial Minister Robertson said events will exacerbate a slowdown in the economy and that is evidence that inflation has peaked. The same challenges the hawkish bias surrounding the Reserve Bank of New Zealand (RBNZ) ahead of the next week’s monetary policy meeting.


The USD/CAD pair attracts some buyers near the 1.3360-1.3355 region on Thursday and for now, seems to have stalled the pullback from the weekly high touched the previous day. The pair is currently placed just below the 1.3400 round-figure mark, nearly unchanged for the day, heading into the North American session.


USD/CHF pleases bulls around 0.9280-85 as it rises for the fourth consecutive day during early Friday. In doing so, the Swiss Franc (CHF) pair follows the general US Dollar strength amid a light calendar ahead of the fourth quarter (Q4) Industrial Production for Switzerland. Be it strong US data or the geopolitical risks emanating from China, not to forget hawkish Fed talks and strong US Treasury bond yields, the US Dollar has it all to justify the latest rise. That said, the US Dollar Index (DXY) takes the bids to refresh a six-week high near 104.30 at the latest.


Oil prices fell slightly on Friday and were set to close the week lower as concerns over rising U.S. interest rates and a strong dollar largely offset optimism over a potential recovery in Chinese demand.


Gold price is extending its three-day bearish momentum on Friday, following Thursday’s sharp reversal from near the $1,850 level. The buying interest around the United States Dollar (USD) remains unabated amid hawkish US Federal Reserve (Fed) expectations. 

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