Global currency markets remain volatile due to uncertainty about central bank policies and economic data. USD could weaken further if FOMC minutes signal rate cuts in the US. CAD and AUD may benefit from weaker USD and improving domestic economies. Oil prices and economic data remain key factors influencing exchange rates.
Japanese Yen (JPY):
- Currently at 149.98, consolidating after recent gains.
- JPY trades in a narrow range after US dollar weakens.
- Japanese business confidence falls in February.
- January export data shows strong growth, but imports also rise.
- JPY benefits from weaker USD, allowing for a pause before determining its next direction.
- Technical analysis suggests a neutral outlook.
Australian Dollar (AUD):
- AUD gains for the sixth consecutive day, currently at 0.6552.
- Wage growth in Australia hits highest level since 2009.
- RBA may consider this data pro-inflationary, but wage growth is slowing.
- Markets believe the RBA’s tightening cycle is over, but rate cuts are unlikely in the near term.
- Technical analysis suggests further upside potential towards 0.6608.
Canadian Dollar (CAD):
- CAD remains quiet ahead of FOMC minutes release.
- Markets await clues about the Fed’s future interest rate path.
- Canadian inflation falls to lowest level since June 2023.
- BoC unlikely to cut rates until inflation shows a clear downward trend.
- Technical analysis suggests downside potential towards 1.3415.
The AUD and JPY are currently stable, while the CAD awaits further direction from the Fed. Markets are anticipating potential rate cuts for the AUD and CAD later this year.
Categories: ARFX News
