Forex News
- NZD/USD weakens to around 0.5615 in Thursday’s early Asian session.
- Closer New Zealand election race raises investor concerns over policy uncertainty.
- Markets priced in a lower probability for an October Fed rate hike following the PCE inflation release.
The NZD/USD pair loses momentum to near 0.5615 during the early European trading hours on Thursday. The New Zealand Dollar (NZD) weakens against the US Dollar (USD) as the tighter New Zealand election race raises investor fears on policy backflips. Traders await the US weekly Initial Jobless Claims data and the Fedspeak later on Thursday.
New Zealand’s reputation for political stability is facing a test as a closely contested election approaches on November 7, with opinion polls indicating that Prime Minister Christopher Luxon’s coalition could lose power. For investors, a change in government raises the prospect of policy uncertainty. If elected, Labour signaled that it would restore that dual mandate, among other policy reversals.
Remarks from Federal Reserve (Fed) policymaker John Williams and US Personal Consumption Expenditures (PCE) inflation data further dimmed the outlook for an October move. Fed’s Williams said on Tuesday that “With the policy action we took at our September meeting, there is no need for urgency, and we have time to gather more information.”
This prompted traders to lean in favor of a rate hike in December over October, the CME Group's FedWatch Tool showed. Markets are now pricing in nearly a 37.6% chance of a Fed rate hike in October and a 90.6% odds of an increase in December.
Kashkari questions policy tightness as resilient economy keeps Fed hawkish
Kashkari’s latest remarks score 7.1 on the FXS Speechtracker, notably above the 6.2 historical average, underscoring a firmer hawkish tone relative to the established baseline. By stressing that inflation near 3% remains “too high” and highlighting resilient growth, strong labor markets, and ongoing consumer spending, the speech points to limited urgency for rate cuts and openness to further tightening. Kashkari’s suggestion that the neutral rate may be higher and elevated “for now,” alongside penciling in one more hike this year and another in 2027, reinforces a higher-for-longer Dollar rate narrative despite hopes of achieving disinflation with only modest action.
The FXS Fed Sentiment Index slipped by 0.42 points to 143.28, signaling a slight pullback in perceived hawkishness even as the overall stance remains firmly in hawkish territory well above the 100 neutral mark. This combination of a strong FXS Speechtracker score and an elevated FXS Fed Sentiment Index level suggests that, despite some moderation, Fed communication continues to support a structurally higher Dollar rate environment.
Technical Analysis: NZD/USD retains a negative tone amid oversold conditions
In the daily chart, NZD/USD keeps a clear bearish bias as spot remains under the 100-day Simple Moving Average (SMA) and even below the Bollinger middle band. Price is only slightly above the Bollinger lower band support, highlighting a heavy downside tone, while the Relative Strength Index (14) at 24.15 sits in oversold territory, suggesting that although selling pressure is intense, short-term rebounds cannot be ruled out.
On the downside, immediate support is located at the Bollinger lower band around 0.5575, and a decisive break beneath this floor would open the way for a deeper slide toward the next psychological levels below 0.5550. On the topside, initial resistance emerges at the Bollinger middle band near 0.5738, followed by the 100-day SMA at 0.5810; as long as NZD/USD holds beneath these caps, any recovery is likely to be corrective rather than the start of a sustained bullish phase, with the Bollinger upper band at 0.5900 marking a more distant hurdle.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
New Zealand Dollar FAQs
The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD.
The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair.
Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate.
The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
- EUR/USD trades lower at around 1.1310 as the US Dollar outperforms.
- US Treasury Yields surge as investors shrug-off moderate growth in US PCE Inflation data.
- Investors await the Eurozone HICP data for September releasing on Friday.
The Euro (EUR) is down 0.16% at around 1.1310 against the US Dollar (USD) during the European trading session on Thursday. The major currency pair is under pressure as the US Dollar outperforms due to surging United States (US) Treasury Yields.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.10% | 0.00% | 0.46% | 0.04% | -0.11% | 0.23% | 0.11% | |
| EUR | -0.10% | -0.09% | 0.32% | -0.10% | -0.21% | 0.11% | 0.00% | |
| GBP | -0.01% | 0.09% | 0.42% | 0.02% | -0.13% | 0.23% | 0.10% | |
| JPY | -0.46% | -0.32% | -0.42% | -0.42% | -0.56% | -0.24% | -0.34% | |
| CAD | -0.04% | 0.10% | -0.02% | 0.42% | -0.14% | 0.18% | 0.08% | |
| AUD | 0.11% | 0.21% | 0.13% | 0.56% | 0.14% | 0.34% | 0.24% | |
| NZD | -0.23% | -0.11% | -0.23% | 0.24% | -0.18% | -0.34% | -0.08% | |
| CHF | -0.11% | -0.00% | -0.10% | 0.34% | -0.08% | -0.24% | 0.08% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
As of writing, the US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, is close to its yearly high of 101.80. 10-year US Treasury Yields have a hit fresh high near 5.30%, the highest level seen in two decades.
US Treasury Yields have surged even as US Personal Consumer Expenditure (PCE) Inflation data for August showed a moderate growth in price pressures.
What is supporting US bond yields
According to TD Securities, the latest US PCE and GDP revisions were “a mixed bag,” combining “hawkish backward adjustments to growth and dovish adjustments to inflation.” The bank argues that “the underlying trend is the key story,” with “robust growth with rising inflation risks” expected to “continue to dominate the Fed's outlook.” In that context, TD Securities says, “we still expect the Fed to lift rates in October, but can't discard a more gradual approach.”
Meanwhile, the Euro is under pressure even as preliminary German Harmonized Index of Consumer Prices (HICP) data for September has come in stronger-than-expected.
Going forward, investors will focus on the flash Eurozone HICP data for September, which will be released on Friday.
EUR/USD Technical Analysis
In the daily chart, EUR/USD trades at 1.1314, keeping a clear bearish near-term bias as spot holds beneath the 20-period exponential moving average (EMA) at 1.1448. The pair’s slide away from that EMA resistance suggests sellers remain in control, while the Relative Strength Index (RSI) at 21.8 shows oversold conditions that could slow the downside, but not yet signal a sustainable recovery as long as price stays capped below the short-term trend indicator.
On the topside, the June 24 low at 1.1325 is the immediate resistance, followed by the 20-period EMA at 1.1448, which acts as the first barrier any corrective bounce would need to reclaim to ease the current bearish pressure. Looking down, the downside pressure might inftensify if the pair breaks below 1.1300. On the downside, the 1.1200 would be the next major support level.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator
Core Personal Consumption Expenditures - Price Index (YoY)
The Core Personal Consumption Expenditures (PCE), released by the US Bureau of Economic Analysis on a monthly basis, measures the changes in the prices of goods and services purchased by consumers in the United States (US). The PCE Price Index is also the Federal Reserve’s (Fed) preferred gauge of inflation. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The core reading excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures." Generally, a high reading is bullish for the US Dollar (USD), while a low reading is bearish.
Read more.Last release: Wed Sep 30, 2026 12:30
Frequency: Monthly
Actual: 3%
Consensus: 3.3%
Previous: 3.3%
Source: US Bureau of Economic Analysis
After publishing the GDP report, the US Bureau of Economic Analysis releases the Personal Consumption Expenditures (PCE) Price Index data alongside the monthly changes in Personal Spending and Personal Income. FOMC policymakers use the annual Core PCE Price Index, which excludes volatile food and energy prices, as their primary gauge of inflation. A stronger-than-expected reading could help the USD outperform its rivals as it would hint at a possible hawkish shift in the Fed’s forward guidance and vice versa.
Here is what you need to know on Thursday, October 1:
Following the choppy action seen on the last day of the third quarter, the US Dollar (USD) holds its ground against its rivals in the European morning on Thursday. The US economic calendar will feature weekly Initial Jobless Claims data and the Institute for Supply Management's (ISM) Manufacturing Purchasing Managers' Index report for September. Several policymkers from the European Cental Bank (ECB) and the Federal Reserve (Fed) will be delivering speeches throughout the day.
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.52% | -0.13% | 0.59% | 0.76% | 0.84% | 0.72% | 1.05% | |
| EUR | -0.52% | -0.70% | 0.11% | 0.21% | 0.32% | 0.19% | 0.52% | |
| GBP | 0.13% | 0.70% | 0.63% | 0.90% | 1.00% | 0.88% | 1.20% | |
| JPY | -0.59% | -0.11% | -0.63% | 0.06% | 0.19% | 0.06% | 0.36% | |
| CAD | -0.76% | -0.21% | -0.90% | -0.06% | 0.13% | -0.04% | 0.31% | |
| AUD | -0.84% | -0.32% | -1.00% | -0.19% | -0.13% | -0.13% | 0.19% | |
| NZD | -0.72% | -0.19% | -0.88% | -0.06% | 0.04% | 0.13% | 0.33% | |
| CHF | -1.05% | -0.52% | -1.20% | -0.36% | -0.31% | -0.19% | -0.33% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
On Wednesday, the Automatic Data Processing (ADP) reported that employment in the private sector increased by 90K in September, surpassing the market expectation of 70K. In the meantime, the US Bureau of Economic Analysis revised the annualized Gross Domestic Product (GDP) growth for the second quarter to 2.2% from 1.5% in the previous estimate, and announced that the core Personal Consumption Expenditures (PCE) Price Index, the Fed's preferred gauge of inflation, rose 3% on a yearly basis in August. This print came in below the market expectation of 3.3%. The US Dollar (USD) Index retreated with the initial reaction to the mixed data releases but managed to regain its traction later in the American session to end the day marginally higher. Early Thursday, the USD Index holds above 101.50.
US inflation revisions temper relief as Fed keeps October options open
Economists at Societe Generale note that August inflation data offered only limited comfort to the Fed. They highlight that while "Core PCE undershot expectations," the underlying picture was "less reassuring," with "softer core goods inflation" merely masking "a reacceleration in core services and super-core inflation, pointing to still-firm underlying price pressures."
Turning to the policy outlook, Societe Generale judges that "inflation revisions were modestly favorable, but growth revisions were more important." In their view, "the economy entered 2H26 with stronger momentum than previously thought, while underlying inflation remains too elevated to provide the Fed with clear comfort." As a result, they argue that "a pause in October remains possible, but an October hike remains on the table pending September CPI and PPI data."
Fed's Kashkari questions policy tightness as resilient economy keeps hawkish bias alive
Meanwhile, Minneapolis Fed President Neel Kashkari delivered a notably hawkish-leaning message, with a FXS Speechtracker score of 7.1/10, and further supported the USD late Wednesday. Kashkari underscored his concern that inflation near 3% remains “too high” despite recent data. Emphasis on a resilient economy, strong consumer spending, and broad job availability, alongside doubts about how tight policy really is and suggestions that the neutral rate may be higher and “elevated at least for now,” reinforced the case for keeping rates restrictive. The explicit penciling in of one more hike this year and another in 2027, while hoping to tame inflation with only modest action, signalled a bias toward further tightening if the economy and inflation fail to cool meaningfully.
The Bank of Japan (BoJ) published the Summary of Opinions from the September monetary policy meeting earlier in the day. The document showed that some members noted that it would be appropriate to keep raising the interest rate in line with the economy and price developments, while reiterating that they must focus on anchoring the underlying inflation near 2%. After closing virtually unchanged on Wednesday, USD/JPY gathers bullish momentum and trades near 158.20 in the European morning on Thursday, rising more than 0.5% on the day.
EUR/USD remains under bearish pressure after closing in the red on Wednesday and declines toward 1.1300.
GBP/USD benefited from the upbeat UK macroeconomic data on Wednesday and managed to register daily gains despite the broad USD resilience. The pair, however, fails to preserve its bullish momentum and trades marginally lower on the day near 1.3250 in the early European session.
Gold recovers modestly toward $4,200 in the European morning after losing about 0.6% on Wednesday.
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
- Gold reverses a modest Asian session dip, though any meaningful appreciation seems elusive.
- The USD buying remains unabated as oil-driven inflation fears keep US bond yields elevated.
- Geopolitical risks further underpin the safe-haven buck, warranting caution for XAU/USD bulls.
Gold (XAU/USD) builds on the steady intraday ascent heading into the European session on Thursday and reverses the previous day's modest losses, though the upside potential seems limited. The US Dollar (USD) climbs to a fresh high since July 28 as US bond yields remain elevated, keeping the non-yielding yellow metal below the $4,200 mark and warranting caution for bullish traders.
The US Bureau of Economic Analysis (BEA) reported on Wednesday that the Personal Consumption Expenditures (PCE) Price Index rose 3.4% YoY in August, unchanged from the previous month's downwardly revised reading and missed estimates of a 3.7% print. Moreover, the core gauge, which excludes volatile food and energy prices, matched July's downwardly revised 3% YoY rate and fell short of expectations. This comes on top of dovish comments from New York Federal Reserve (Fed) President John Williams and tempered bets on an October rate hike, which offered some support to gold.
US inflation revisions temper pressure but keep October FOMC hike in play
Societe Generale’s Jan Groen notes that August US inflation data delivered a mixed signal for policymakers. While “Core PCE undershot expectations,” he cautions that “the details were less reassuring,” with “softer core goods inflation” effectively masking “a reacceleration in core services and super-core inflation, pointing to still-firm underlying price pressures.”
Turning to the broader policy backdrop, Groen argues that “inflation revisions were modestly favorable, but growth revisions were more important.” In his view, “the economy entered 2H26 with stronger momentum than previously thought, while underlying inflation remains too elevated to provide the Fed with clear comfort.” Against that setting, Societe Generale judges that “a pause in October remains possible, but an October hike remains on the table pending September CPI and PPI data.”
The initial market reaction, however, turned out to be short-lived amid an upward revision to the US GDP growth from 1.5% to 2.2% annualized rate for the second quarter of 2026. Furthermore, oil-driven inflation risks underpin the prospects for additional Fed tightening, which keeps US bond yields near multi-year highs. According to CME Group's FedWatch Tool, traders are still pricing in an over 85% chance that the US central bank will raise borrowing costs by the end of this year. Moreover, the US-Iran standoff lifts the safe-haven buck to a fresh high since July 28, which should cap the Gold price.
Hopes for a diplomatic solution to end the US-Iran war faded after President Donald Trump turned down a seven-day peace proposal from Iran to resolve the military conflict and reopen the Strait of Hormuz. Moreover, Trump has told aides that he expects major combat operations and renewed bombing against Iran to resume following the November midterm elections. In further developments, US Secretary of State Marco Rubio told the Iranian delegation to leave the country immediately amid stalled peace talks. This keeps the geopolitical risk premium in play, favours USD bulls and caps the Gold price.
Traders now look forward to the US economic docket – featuring the usual Weekly Initial Jobless Claims and the ISM Manufacturing PMI. Apart from this, speeches from a slew of influential FOMC members will drive USD demand and provide some impetus to the bullion. Meanwhile, the focus will remain glued to the US Nonfarm Payrolls (NFP) report, due on Friday, which will be looked at for more cues about the Fed's policy path. Furthermore, the incoming geopolitical headlines might infuse volatility across global financial markets and produce meaningful trading opportunities around gold.
XAU/USD 4-hour chart
Technical Analysis
The XAU/USD pair keeps a bearish, capped tone and remains lodged within a downward-sloping parallel channel. The upper boundary of the channel coincides with the 100-period Simple Moving Average (SMA) on the 4-hour chart and reinforces overhead supply near $4,300. That said, the Moving Average Convergence Divergence (MACD) indicator has turned positive, while the Relative Strength Index (RSI) hovers near 44, hinting at stabilizing momentum. Mixed momentum indicators signal only a softening of the downside pressure, rather than overturning the prevailing bearish structure.
Hence, any subsequent move up might still be seen as a selling opportunity and remain capped near the aforementioned confluence hurdle. On the downside, the lower boundary of the channel at $4,082 acts as key support, and a clean break beneath this floor would likely open the way to a broader bearish extension in the near term.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.50% | -0.14% | 0.55% | 0.73% | 0.85% | 0.71% | 1.00% | |
| EUR | -0.50% | -0.70% | 0.13% | 0.21% | 0.34% | 0.19% | 0.48% | |
| GBP | 0.14% | 0.70% | 0.65% | 0.88% | 1.00% | 0.86% | 1.15% | |
| JPY | -0.55% | -0.13% | -0.65% | 0.06% | 0.21% | 0.07% | 0.33% | |
| CAD | -0.73% | -0.21% | -0.88% | -0.06% | 0.16% | -0.03% | 0.28% | |
| AUD | -0.85% | -0.34% | -1.00% | -0.21% | -0.16% | -0.15% | 0.14% | |
| NZD | -0.71% | -0.19% | -0.86% | -0.07% | 0.03% | 0.15% | 0.29% | |
| CHF | -1.00% | -0.48% | -1.15% | -0.33% | -0.28% | -0.14% | -0.29% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
- USD/JPY stretches above 158.00, nearing one-month highs just above 159.00.
- The BoJ shows growing concerns about inflation, with some policymakers calling for a steeper monetary tightening cycle.
- US PCE inflation came out softer than expected, but the high Treasury yields keep the US Dollar buoyed.
The Japanese Yen (JPY) heads lower against the US Dollar (USD) on Thursday as higher US Treasury yields have offset the positive impact of a hawkishly tilted Summary of Opinions by the Bank of Japan (BoJ) and soft US inflation numbers. The USD/JPY pair advances beyond 158.00, nearing the one-month high just above 159.00.
Bank of Japan policymakers noted that Japan’s economy has recovered moderately while inflation nears the 2% target. Under these circumstances, some voices within the committee called for accelerating the monetary tightening pace or bringing interest rates to the central bank’s approximate goal sooner, according to the Summary of Opinions of September’s meeting, released earlier on Thursday.
The impact of these comments on the Yen, however, has been muted, as the US Dollar extended its uptrend, with US long-term Treasury yields rising to fresh highs. The uncertainty in the Middle East conflict and the energy shock stemming from it, plus the elevated debt of the world's major economies, have triggered a global bond sell-off that is pushing yields to their highest level in decades.
US inflation revisions temper pressure but keep October FOMC hike in play
The high US Treasury yields also offset a soft US Personal Consumption Expenditures (PCE) Price Index report on Wednesday, which showed that inflation rose less than expected in September, while data from August was revised lower. The report cooled hopes of back-to-back Federal Reserve (Fed) rate hikes, although the negative impact on the US Dollar was minimal.
Analysts at Societe Generale note that the August US inflation report gave mixed signals, as "softer core goods inflation masked a reacceleration in core services and super-core inflation, pointing to still-firm underlying price pressures."
Regarding monetary policy, Societe Generale argues that "inflation revisions were modestly favorable, but growth revisions were more important." In their view, "the economy entered 2H26 with stronger momentum than previously thought, while underlying inflation remains too elevated to provide the Fed with clear comfort." All in all, the experts conclude that "a pause in October remains possible, but an October hike remains on the table pending September CPI and PPI data."
Japanese Yen FAQs
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
- GBP/USD softens to near 1.3250 in Thursday’s early European session.
- The negative outlook for the pair prevails below the 100-day SMA, with bearish RSI momentum.
- The initial support level is seen at 1.3202; the immediate resistance level to watch is 1.3311.
The GBP/USD pair trades in negative territory around 1.3250 during the early European trading hours on Thursday. The British Pound (GBP) edges lower against the US Dollar (USD) amid widening monetary policy divergence between the Bank of England (BoE) and the US Federal Reserve (Fed). The US weekly Initial Jobless Claims report and the Fedspeak will be in the spotlight later in the day.
BoE policymaker Alan Taylor said on Tuesday it was unclear that it would be practical for the central bank to do a single rate hike to tame inflation without fueling unwarranted market speculation of further increases.
Traders are pricing in nearly a 33 basis points (bps) of monetary tightening from the BoE by year-end and more than 100 bps by the end of 2027, according to LSEG-compiled data, although analysts broadly expect much more limited action.
Softer-than-expected US Personal Consumption Expenditures (PCE) inflation data weigh on the Greenback and act as a tailwind for the major pair. Financial markets now see an about 38.2% probability of a rate hike in October, down from about 45% before the US PCE data, according to the CME FedWatch Tool.
Pound outlook brightens as MUFG flags stronger UK growth and reverse-Brexit potential
Analysts at MUFG note that the UK growth backdrop has improved, with the bank having "raised their forecast for growth in Q3 to 0.4% up from their previous projection of 0.1% set back in July." They argue that "stronger growth will encourage the BoE to tighten policy soon if higher energy prices conte to prove more persistent," and highlight that one senior official at the central bank "judges that risks to the inflation outlook are ‘more titled to the upside’." Beyond the near-term policy implications, MUFG also points to the evolving political landscape, suggesting that greater openness to closer EU ties "opens up the possibility for a potential reverse-Brexit trade for the pound in the future."
Kashkari questions policy tightness as resilient economy keeps Fed hawkish
Fed’s Kashkari delivered a notably hawkish-leaning message, with a FXS Speechtracker score of 7.1/10, above the 6.2/10 historical average, underscoring concern that inflation near 3% remains “too high” despite recent data. The emphasis on a resilient economy, strong consumer spending, and broad job availability, alongside doubts about how tight policy really is and a potentially higher neutral rate, reinforces a bias toward further tightening, highlighted by penciling in one more hike this year and another in 2027 while still hoping to tame inflation with only modest action. Overall, the tone suggests the Fed is not yet convinced that current policy settings are sufficiently restrictive to guarantee a return to target.
The FXS Fed Sentiment Index slipped by 0.42 points to 143.28, signaling a modest pullback in perceived hawkishness even as the index remains firmly above the neutral 100 mark. This configuration indicates that, despite a slight softening versus recent readings, Fed communication as captured by the FXS Fed Sentiment Index and FXS Speechtracker still resides in clear hawkish territory, consistent with Kashkari’s openness to additional rate hikes and an elevated neutral rate.
Technical Analysis: GBP/USD remains bearish below the 100-day SMA in the near term
In the daily chart, GBP/USD maintains a bearish near-term bias as it holds below the 100-day simple moving average (SMA) and the Bollinger Bands 20-period middle band. The pair is edging closer to the lower Bollinger band, while the Relative Strength Index (RSI) at 33.20 hovers just above oversold territory, hinting that downside momentum remains in place but could be nearing exhaustion.
On the downside, immediate support level is located at the September 29 low of 1.3202, followed by Bollinger lower band near 1.3140. A daily close below this floor would expose the November 20, 2025 low of 1.3038 and then the 1.3000 psychological level.
On the topside, initial resistance stands at the September 30 high of 1.3311, en route to the Bollinger middle band at 1.3385, and the 100-day SMA at 1.3415. A more distant upside barrier is located at the upper Bollinger band around 1.3630.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
- Australian Dollar is up against its major peers as RBA is seen on an extended hold.
- Australian Trade Surplus shrinks to A$495 million in August.
- Investors keenly await the US ISM Manufacturing PMI data for September.
The Australian Dollar (AUD) is up against its major currency pairs on Thursday, but is almost flat against the US Dollar (USD) at around 0.6948 in the early European trade. The antipodean outperforms even as market experts see the Reserve Bank of Australia (RBA) shifting to an extended hold after hiking its Official Cash Rate (OCR) four times this year by 25 basis points (bps) to 4.6%.
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.09% | 0.14% | 0.60% | 0.11% | -0.04% | 0.24% | 0.08% | |
| EUR | -0.09% | 0.04% | 0.50% | -0.03% | -0.14% | 0.13% | -0.01% | |
| GBP | -0.14% | -0.04% | 0.48% | -0.04% | -0.18% | 0.10% | -0.04% | |
| JPY | -0.60% | -0.50% | -0.48% | -0.52% | -0.65% | -0.40% | -0.53% | |
| CAD | -0.11% | 0.03% | 0.04% | 0.52% | -0.13% | 0.12% | -0.01% | |
| AUD | 0.04% | 0.14% | 0.18% | 0.65% | 0.13% | 0.29% | 0.15% | |
| NZD | -0.24% | -0.13% | -0.10% | 0.40% | -0.12% | -0.29% | -0.11% | |
| CHF | -0.08% | 0.01% | 0.04% | 0.53% | 0.00% | -0.15% | 0.11% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
RBA hike seen as likely the last as Bullock strikes dovish tone
Analysts at Standard Chartered Global Research note that the Reserve Bank of Australia (RBA) raised the cash rate to 4.60% at the 29 September meeting, “as we had expected (see RBA – Crossing the Rubicon) in a unanimous decision.” They highlight that the accompanying statement “cited the materialisation of upside risks to inflation but acknowledged slowing economic growth, easing labour-market conditions and falling housing prices,” while still keeping “the door open for more hikes ‘if needed’.”
Conversely, Standard Chartered’s team detected “a more dovish slant from Governor Bullock at the press conference,” pointing out that she indicated “that a rate hike and a hold were discussed in the meeting.” Crucially, “she did not talk up the possibility of another rate hike in Q4, and emphasised the lags of monetary policy transmission from the rate hikes so far.” Against that backdrop, Standard Chartered conclude that “our takeaway remains that the central bank is probably done with rate hikes.”
Meanwhile, Australia’s trade data shows that surplus narrowed significantly in August. Earlier in the day, the Trade Balance report revealed that surplus narrowed sharply to AUD$495 million in August, from a surplus of A$1,351M in the previous reading. The August Trade Surplus was also revised lower from A$1,923M.
On the US Dollar front, investors await the United States (US) ISM Manufacturing Purchasing Managers’ Index (PMI) data for September, which will be published at 14:00 GMT.
AUD/USD Technical Analysis
In the daily chart, AUD/USD trades at 0.6948, maintaining a bearish near-term bias as it holds beneath the 20-period Exponential Moving Average (EMA) at 0.7063 and a dense Fibonacci resistance band starting from the 61.8% retracement at 0.7010. The Relative Strength Index (RSI) at 27.6 sits in oversold territory, hinting that while downside pressure persists, the pace of the recent slide could begin to moderate rather than accelerating sharply from current levels.
On the downside, immediate support aligns with the 78.6% Fibonacci retracement at 0.6947, with a deeper structural floor at the 100.0% Fibonacci anchor near 0.6867 if selling resumes. On the topside, initial resistance is seen at the 61.8% retracement at 0.7010, followed by the 50.0% level at 0.7054 and the 20-period EMA at 0.7063, while higher barriers emerge at the 38.2% retracement at 0.7097, the 23.6% level at 0.7152, and ultimately the cycle high area around the 0.0% retracement at 0.7240.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Economic Indicator
Trade Balance (MoM)
The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
Read more.Last release: Thu Oct 01, 2026 01:30
Frequency: Monthly
Actual: 495M
Consensus: -
Previous: 1,923M
Source: Australian Bureau of Statistics
- Swiss ZEW investor expectations dropped to 2.6 in September, reflecting growing concerns over domestic inflation trends.
- The SNB maintained its policy rate at 0% and reaffirmed its readiness to intervene in forex markets.
- USD gains remain capped as cooling U.S. PCE inflation reduced expectations for an October Fed rate hike.
USD/CHF continues its winning streak for the seventh consecutive trading day, reaching its fresh 16-month high of 0.8367 during Asian hours on Thursday. The currency pair appreciated as the Swiss Franc (CHF) lost ground due to sharply weakening investor sentiment in September. Traders await Swiss Consumer Price Index (CPI) data release due later in the day.
Swiss ZEW Survey – Expectations fell to 2.6, its lowest level in three months, down from 12.1 previously. Despite the drop, the survey noted that analysts continue to view the underlying condition of the Swiss economy positively, though concerns over inflation have heightened.
Meanwhile, in its third quarterly monetary policy assessment on September 24, 2026, the Swiss National Bank (SNB) decided to keep its policy rate unchanged at 0%. The SNB noted that medium-term inflationary pressure had increased only slightly since June and that its current stance remains appropriate to maintain price stability while supporting economic development. The central bank also reaffirmed its readiness to intervene in the foreign exchange market as necessary to maintain appropriate monetary conditions.
However, upside momentum for the USD/CHF cross could remain limited as the U.S. Dollar (USD) struggles against easing Federal Reserve rate hike expectations following softer-than-expected inflation data released on Wednesday. The CME FedWatch Tool shows that markets now price in roughly a 38% chance of a Fed rate hike in October, down from nearly 51% prior to the PCE release. Market focus now turns to Friday’s U.S. Nonfarm Payrolls report, where consensus forecasts expect 90,000 jobs added in September and the unemployment rate to hold steady at 4.1%.
The shift in Fed expectations was driven by August U.S. PCE price index data, which rose 0.3% month-over-month against a 0.4% forecast, while core PCE increased 0.2%, missing the 0.3% consensus estimate. On an annual basis, headline PCE inflation decelerated to 3.4%, coming in significantly below the projected 3.7%.
US inflation details keep pressure on Fed despite softer core PCE headline
Societe Generale’s Jan Groen notes that while August US inflation appeared benign at first glance, the underlying picture was more troubling. He points out that “Core PCE undershot expectations, but the details were less reassuring,” as “softer core goods inflation masked a reacceleration in core services and super-core inflation, pointing to still-firm underlying price pressures.” In Groen’s view, the combination of a weaker headline and renewed strength in services underscores that the disinflation trend remains uneven and continues to pose a challenge for the Fed’s efforts to return inflation sustainably to target.
- The Indian Rupee faces selling pressure against the US Dollar as US Treasury Yields rally further.
- Fed’s Kashkari expects one more interest rate hike this year and another in 2027.
- Strong US ADP Employment Change data has set a strong stage for the US NFP.
The Indian Rupee (INR) weakens against the US Dollar (USD) on Thursday after an upside move the previous day. The Indian currency faces selling pressure as United States (US) Treasury Yields extend their rally, supporting the USD/INR pair to move higher to near 95.93.
As of writing, 10-year US Treasury yield is close to 5.31%, the highest level seen in two decades.
Higher yields on US bond yields diminish the appeal of riskier assets, such as the Indian Rupee.
US Treasury Yields extend rally as Fed continues to warn of persistent inflation risks
Yields on US bonds have rallied further as Federal Reserve (Fed) officials continue to warn of persistent inflation risks due to energy supply shocks.
Fed’s Kashkari delivered a notably hawkish-leaning message, with the FXS Speechtracker score at 7.1 versus a 6.2 historical average, underscoring concerns that inflation near 3% remains too high and that resilient growth may signal policy is less tight than assumed. The emphasis on a potentially higher and elevated neutral rate, combined with guidance for one more hike this year and another in 2027, reinforces a narrative of prolonged restrictive policy that is broadly supportive of the Dollar even as Kashkari still hopes to tame inflation with only modest action.
The FXS Fed Sentiment Index slipped by 0.42 points to 143.28, indicating a slight moderation in perceived hawkishness despite the strong tone of the speech. With the index firmly above the 100 neutral line, the Fed remains in clearly hawkish territory, and the small pullback suggests markets are adjusting expectations at the margin rather than fundamentally reassessing the policy stance highlighted by the FXS Speechtracker.
Fed policymakers remain concerned about energy supply shocks due to receded fears of US-Iran diplomacy since President Donald Trump denied reports from Axios claiming Iran sanctions relief.
US NFP data in focus
The next major trigger for the US Dollar is the Nonfarm Payrolls (NFP) data for September, which will be published on Friday. Investors will closely track the US NFP data as it is expected to influence market expectations for the Fed’s monetary policy outlook.
Currently, the CME FedWatch tool shows a 62.4% chance that the Fed will leave interest rates unchanged at the policy meeting this month. The possibility of the Fed maintaining the status quo in October has improved from the 29% seen a week before.
Meanwhile, strong ADP Employment Change figures have set a positive tone for the official employment data. The data showed on Wednesday that the private sector created 90K fresh jobs, higher than the 70K estimate and the August reading of 36K.
Later in the day, investors will focus on the US ISM Manufacturing Purchasing Managers’ Index (PMI) data for September. The Manufacturing PMI is expected to arrive at 55.0, higher from 54.6 in August.
USD/INR Technical Analysis
In the daily chart, USD/INR trades at 95.9705, retaining a mildly bullish near-term bias as it holds above the 20-day exponential moving average (EMA) at 95.7263. The pair remains supported by this short-term trend indicator, while the Relative Strength Index (RSI) at 59.59 stays in positive territory without yet signaling overbought conditions, hinting that upside pressure could persist while the price respects this underlying support.
On the downside, the immediate technical floor is located at the 20-day EMA at 95.7263, where dip-buying interest could emerge if the pair retreats from current levels. As long as USD/INR defends this EMA on a closing basis, the structure favors further consolidation with a slight topside bias, though a decisive break below the average would weaken the bullish tone and expose a deeper corrective phase.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Indian Rupee FAQs
The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee.
The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference.
Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee.
Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
- WTI meets with a fresh supply amid easing supply concerns, though the downside seems cushioned.
- The US-Iran standoff keeps the geopolitical risk premium in play and should support the commodity.
- A convincing break below the 50% Fibo. support is needed to back the case for further depreciation.
West Texas Intermediate (WTI) – the benchmark US Crude Oil price – comes under some renewed selling pressure during the Asian session on Thursday, reversing the previous day's modest recovery gains. The commodity, however, holds above the $88.00 mark and a nearly four-week low as traders await further developments surrounding the Middle East crisis.
Recovery in flows through the Saudi East-West pipeline is seen as a key factor weighing on crude oil prices. However, the US-Iran standoff keeps the geopolitical risk premium in play, which should help limit the downside for the commodity. In fact, hopes for a diplomatic solution to end the US-Iran war faded after President Donald Trump turned down a seven-day peace proposal from Iran. Moreover, Trump has told aides that he expects major combat operations and renewed bombing against Iran to resume following the November midterm elections.
From a technical perspective, the overnight failure to find acceptance above the 200-period Simple Moving Average (SMA) on the 4-hour chart and the subsequent slide favor bearish traders. Moreover, the Moving Average Convergence Divergence (MACD) remains below zero with a slightly negative reading, and the Relative Strength Index (RSI) around 38 suggests lingering downside pressure rather than a decisive oversold reversal. Crude oil prices, however, hold above the 50.0% Fibonacci retracement at $87.75, which should act as a nearby pivot.
A sustained break lower would expose deeper structural supports at the 61.8% retracement at $84.37 and then the 78.6% level at $79.56, ahead of the cycle floor near $73.44. On the topside, initial resistance is seen at the 200-period SMA at $90.11, followed by the 38.2% Fibo. retracement at $91.13, which capped the overnight recovery attempt. Meanwhile, a more substantial bullish reprieve would require a move through the 23.6% retracement at $95.31.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
WTI 4-hour chart
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Forex Market News
Our dedicated focus on forex news and insights empowers you to capitalise on investment opportunities in the dynamic FX market. The forex landscape is ever-evolving, characterised by continuous exchange rate fluctuations shaped by vast influential factors. From economic data releases to geopolitical developments, these events can sway market sentiment and drive substantial movements in currency valuations.
At Rakuten Securities Hong Kong, we prioritise delivering timely and accurate forex news updates sourced from reputable platforms like FXStreet. This ensures you stay informed about crucial market developments, enabling informed decision-making and proactive strategy adjustments. Whether you’re monitoring forex forecasts, analysing trading perspectives, or seeking to capitalise on emerging trends, our comprehensive approach equips you with the insights needed to navigate the FX market effectively.
Stay ahead with our comprehensive forex news coverage, designed to keep you informed and prepared to seize profitable opportunities in the dynamic world of forex trading.
