Forex News

UOB’s Ho Woei Chen highlights that China’s March data showed a sharp divergence between exports and imports, narrowing the trade surplus to a 13‑month low. The report stresses that seasonal factors and last year’s high base weighed on exports, while higher energy and raw material prices boosted imports. UOB notes resilient technology exports and expects further upside pressure on import prices as geopolitical risks persist.

Trade surplus narrows as imports jump

"China’s exports slumped while imports surged in Mar. In USD-terms, exports slowed to 2.5% y/y (Bloomberg est: 8.6%, Feb: 39.6%) and imports surged 27.8% y/y (Bloomberg est: 13.9%, Feb: 13.8%). Consequently, the trade surplus narrowed sharply to US$51.13 bn from US$90.98 bn in Feb, the lowest in 13 months."

"On the import side, the sharp acceleration in Mar was partly driven by higher global energy and raw material prices linked to the ongoing Middle East conflict. China’s imports of semiconductors and computers remained firm, alongside steady purchases of key commodities such as copper and iron. In volume terms, imports of coal and refined petroleum products increased compared with Mar last year, while crude oil and LPG imports declined, likely reflecting supply disruptions in the Middle East and a gradual shift toward alternative energy sources."

"With geopolitical risks persisting, import prices are expected to face further upside pressure in the coming months."

"Despite the softening of exports in Mar, overall trade performance in 1Q26 remained solid. Exports grew 14.7% y/y during the quarter, while imports rose even faster at 22.7% y/y. China recorded a cumulative trade surplus of US$264.33bn in 1Q26, slightly lower than US$271.09bn in 1Q25."

"Looking ahead, while it may still be premature to fully assess the impact of the Middle East conflict, a prolonged escalation is expected to weigh on global demand and pose risks to China’s export outlook."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

ING analysts Muhammet Mercan, Frantisek Taborsky and James Wilson note that the Turkish Lira (TRY) has stabilised after US-Iran tensions eased, with the Central Bank of Turkey (CBT) maintaining market confidence and a steady USD/TRY path. They highlight reduced but now recovering TRY long positions, lower FX reserves, and project USD/TRY to move gradually toward 46.6 by mid‑2026 as carry trades resume.

Lira seen steady as carry returns

"Similar to the rest of the EM space, we have seen some relief in Turkey following signs of de-escalation in the US-Iran conflict. This suggests that the worst of the US-Iran conflict should be over, and the central bank has been relatively untroubled in maintaining market confidence and a stable USD/TRY trajectory. This has been helped by significant rhetorical activity from officials in recent weeks."

"The TRY market has navigated the US-Iran conflict by significantly reducing long positions, which have been cut approximately in half. Additionally, CBT FX reserves declined from a peak of US$210bn to about US$161bn, reflecting the broader sell-off in global gold markets. However, recent market data suggests a resumption of long positions in TRY, which is in line with improving global sentiment."

"Overall, we expect USD/TRY to remain on a stable trajectory up to 46.6 by mid-year and the market will gradually resume long carry trades in TRY."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

• Aussie holds steady as markets await Australia’s March employment report.
• USD lacks a clear direction amid mixed yields and the Middle East war.
• RBA outlook remains cautious, with labor data seen as key for policy expectations.

The AUD/USD surged near the 0.7160 price region on Wednesday, as investors positioned ahead of key Australian labor market data and continued to assess the broader US Dollar (USD) backdrop amid mixed United States (US) macro signals.

The Greenback has struggled to extend gains despite lingering safe-haven demand tied to Middle East tensions, with US yields stabilizing and limiting directional conviction. This has allowed the Australian Dollar (AUD) to hold firm.

Attention now shifts to Australia’s March employment report, due later today. Expectations point to a modest labor market expansion, with the economy projected to add around 20K jobs. The Unemployment Rate is expected to hold steady at 4.3%, while the Participation Rate, at 66.9%, will also be closely watched for signs of labor market resilience.

Short-term technical analysis:

In the four-hour chart, AUD/USD trades at 0.7167, holding a bullish near-term bias as price consolidates above both the 20-period Simple Moving Average (SMA) at 0.7102 and the longer-term 100-period SMA at 0.6974. The cluster of nearby horizontal levels at 0.7159, 0.7139, and 0.7133 reinforces underlying demand, though the Relative Strength Index (14), hovering in overbought territory near 73, suggests upside momentum is stretched and vulnerable to a corrective pause.

On the topside, immediate resistance is located at 0.7169, where initial supply is capping further gains for now. On the downside, first support is at 0.7159, with additional layers of demand at 0.7139 and 0.7133; a deeper pullback would bring the 20-period SMA at 0.7102 into view, ahead of the more distant 100-period SMA support near 0.6974.

(The technical analysis of this story was written with the help of an AI tool.)

• WTI US Oil prices stabilize around $89 after briefly sliding to a three-week low near $85 earlier in the day.
• Rising geopolitical tensions in the Middle East support Oil prices, with the US preparing to deploy additional troops to the region.
• However, renewed hopes for negotiations between Washington and Tehran are limiting further gains in Crude markets.

West Texas Intermediate (WTI) US Oil trades around $89.10 on Wednesday at the time of writing, remaining broadly stable on the day after earlier falling to a three-week low near $85. The Oil market is caught between escalating geopolitical tensions in the Middle East and renewed hopes for diplomatic progress between the United States (US) and Iran.

On the geopolitical front, a report from The Washington Post indicates that the US administration is preparing to deploy thousands of additional troops to the Middle East in the coming days. The move is reportedly part of a broader Washington strategy to intensify pressure on Tehran and push Iran toward reaching an agreement with the US. Such developments are keeping risk premiums in the Oil market, as traders remain wary of potential disruptions to supply in the region.

However, optimism surrounding a possible diplomatic breakthrough is tempering bullish momentum in Crude Oil prices. Expectations for renewed negotiations between Washington and Tehran have improved after US President Donald Trump suggested that the conflict with Iran could end soon. In an interview with ABC News, Trump said he does not see the need to extend the current two-week ceasefire, while expressing confidence that a positive announcement could emerge in the coming days. “I think you’re going to be watching an amazing two days ahead”, he said.

According to Iranian state media, a Pakistani delegation is currently heading to Tehran to deliver a message from Washington and outline plans for a second round of talks aimed at securing a lasting ceasefire. Reports indicate that another round of negotiations could take place as early as this week, before the current truce expires.

Despite these diplomatic efforts, market sentiment remains fragile. The US blockade of the Strait of Hormuz continues to restrict maritime trade involving Iran, sustaining concerns about supply disruptions. A US Central Command (CENTCOM) commander stated that American forces have effectively halted maritime economic trade to and from Iran, while Iranian Revolutionary Guards warned they could retaliate by blocking imports and exports across the Gulf and the Sea of Oman if the blockade persists.

Analysts at Rabobank highlight that the Oil market remains vulnerable to broader economic risks linked to the disruption of energy flows. The International Monetary Fund (IMF) warns that a prolonged closure of the Strait of Hormuz could trigger a global recession, while the International Energy Agency (IEA) estimates that even if the passage were reopened immediately, restoring normal Oil flows could take between 60 and 150 days.

Against this backdrop of geopolitical uncertainty and fragile diplomacy, Crude prices remain sensitive to headlines from the Middle East, leaving WTI US Oil hovering around $89 as traders await clearer signals on whether tensions will escalate or negotiations will move forward.

• Hopes for extended US-Iran talks keep overall market sentiment supported.
• Fed officials signaled rates could stay unchanged for some time.
• BoE tightening bets continue to offer support to Sterling.

The GBP/USD pair halts its advance on Wednesday and remains steady around 1.3570 as optimism about a resumption of US-Iran talks has tempered. At the same time, US equities extended their gains, and the Greenback seems to have bottomed after hitting a six-week low.

Sterling steadies as Fed hold view offsets softer Dollar tone

Sentiment remains positive, a headwind for the safe-haven appeal of the US Dollar (USD). News that the US-Iran ceasefire could extend for another couple of weeks was cheered by Wall Street, while US President Donald Trump said the war with Iran is near the end, adding that “amazing two days” lie ahead, hinting that both parties could be close to an agreement.

The Washington Post reported that the Pentagon is deploying additional troops to the Middle East. At the same time, the Pakistani military confirmed that Field Marshal Asim Munir arrived in Tehran to narrow the gaps between the two countries.

The US economic docket featured Import and Export prices, with both figures being ignored by market participants. Federal Reserve (Fed) officials continued to grab the headlines as Cleveland Fed Beth Hammack commented that rates will likely remain on hold “for a good while.” She sees no imminent need for the Fed to change its interest rate setting.

Even though the Fed is expected to hold rates, across the pond, the Bank of England (BoE) is expected to tighten policy by 38 basis points towards the end of the year. This favors further upside for GBP/USD, as the rate differential would be higher in the UK.

BoE hawkish bets had grown amid the UK’s reliance on natural gas imports, with prices soaring to near 40%. Nevertheless, the recent news could prompt traders to trim some of those bets as traffic through the Strait of Hormuz resumes.

Earlier, BoE’s Megan Greene, who was hawkish ahead of the Iran war, said she remains worried about price pressures. She commented that it could take months to see the impact of the energy shock on the British economy, given the surge in energy prices.

Ahead, the UK docket will feature the release of Gross Domestic Product (GDP) figures, which are expected to improve from no growth to 0.1% MoM in February. In the US, traders eye the release of Initial Jobless Claims for the week ending April 11 and speeches by Fed officials.

GBP/USD Price Forecast: Technical outlook

In the daily chart, GBP/USD trades at 1.3573, extending a constructive tone after reclaiming the main simple moving averages (SMAs). The latest reading of the 50-, 100- and 200-day SMAs from the moving average triple cluster around 1.3428, leaving spot comfortably above this band and hinting at a bullish near‑term bias while the uptrend structure remains intact.

On the downside, initial support is located at the prior confluence zone around 1.3490–1.3492, where the rising support trend line intersects with recent reaction lows. A deeper pullback would expose the dense SMA cluster near 1.3428, reinforced by the previously capping descending trend line that last rejected prices near 1.3436 and now acts as additional underlying demand. As long as GBP/USD holds above these supports, dips are likely to remain shallow, even if upside reference levels above the market are not yet well defined by the current indicator set.

(The technical analysis of this story was written with the help of an AI tool.)

• Gold trades with a mild downside bias on Wednesday after briefly touching a one-month high earlier in the day.
• Hopes that US-Iran peace talks could resume this week lift sentiment, but risks remain elevated.
• On the 4-hour chart, XAU/USD continues to trade within a range, with the 200-period SMA acting as a key resistance level.

Gold (XAU/USD) holds modest losses on Wednesday even as the US Dollar (USD) remains under broad pressure, while evolving Middle East developments continue to shape broader market sentiment. At the time of writing, XAU/USD is trading around $4,807 after briefly touching a one-month high of $4,871 during the Asian session.

Expectations of renewed negotiations between the United States and Iran have improved after US President Donald Trump said in an interview with Fox Business that “the Iran war can be over very soon.” Reports suggest a second round of peace talks could take place as early as this week, before the current two-week ceasefire expires.

Iranian state media reported that a Pakistani delegation is on its way to Iran to convey a US message and outline plans for a second round of talks.

However, the situation remains uncertain. According to a report by The Washington Post, the Pentagon is preparing to deploy thousands of additional troops to the Middle East in the coming days as the Trump administration steps up pressure on Iran to secure a deal.

This keeps market sentiment fragile despite cautious optimism that a diplomatic resolution may still be within reach. At the same time, the US blockade of the Strait of Hormuz remains in place, limiting downside in Crude prices. West Texas Intermediate (WTI) is trading near $89 at the time of writing, after briefly slipping to over three-week lows near $85 earlier in the day.

A US Central Command (CENTCOM) Commander Admiral Brad Cooper said that “US forces have completely halted economic trade going into and out of Iran by sea.” Meanwhile, Iran’s Revolutionary Guards warned they would block imports and exports across the Gulf and the Sea of Oman if the US blockade on Iranian vessels continues.

While Oil prices remain elevated, the pullback from recent highs has eased inflation concerns, reducing pressure on the Federal Reserve (Fed) to tighten monetary policy and reviving interest rate cut expectations, which could support the non-yielding metal.

However, uncertainty around the Fed’s path persists, as markets continue to assess the economic impact of the war in Middle East. This supports expectations that the central bank will keep rates on hold in the coming months, which remains a headwind for Gold and is diminishing its safe-haven appeal despite heightened geopolitical tensions.

Cleveland Fed President Beth Hammack said on Wednesday that “rates are in a good place,” adding that the baseline is to remain on hold “for a while.” Hammack also noted that “inflation expectations look reasonably well contained,” while emphasizing that “we have to look at inflation and the spending impact of energy.”

Technical analysis: XAU/USD tests 200-period SMA resistance on the 4-hour chart

From a technical perspective, the 4-hour chart shows buyers struggling to extend gains above the 200-period Simple Moving Average (SMA) near $4,837, while holding above the 100-period SMA around $4,637, keeping price action largely range-bound with a mild bullish bias.

The Relative Strength Index (14) near 57 reinforces a positive tone without yet signaling overbought conditions, while the Moving Average Convergence Divergence (MACD) indicator remains in positive territory, suggesting upside momentum remains in play even as gains approach the longer-term average overhead.

On the upside, a sustained break above the 200-period SMA could signal a clear breakout from the current range and strengthen buying interest, with gains potentially extending toward the $5,000 mark.

On the downside, the immediate pivot is the current price region around $4,800, with more meaningful dynamic support emerging at the 100-period SMA at $4,637, where a deeper pullback could look for buyers to re-enter in line with the prevailing constructive bias.

• EUR/USD rises for an eighth straight day as the US Dollar remains under pressure.
• Optimism over potential US-Iran talks supports risk sentiment.
• Oil-driven inflation reshapes Fed and ECB monetary policy outlook.

EUR/USD regains ground on Wednesday, erasing earlier losses as the US Dollar (USD) continues to weaken, allowing the Euro (EUR) to extend gains for an eighth consecutive day amid improving risk sentiment driven by hopes of renewed US-Iran talks. The move higher is largely driven by USD weakness rather than strong Euro fundamentals.

At the time of writing, the pair is trading around 1.1800, hovering near one-month highs. However, price action remains subdued amid limited geopolitical headline flow. Meanwhile, the US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 98.10, holding near the six-week low reached on Tuesday.

Investors are now awaiting confirmation of a second round of peace talks, after Donald Trump said negotiations could take place “over the next two days” in Pakistan. In a separate interview with Fox Business, he added that “the Iran war can be over very soon.”

This has raised expectations that a deal could still be reached, following last week’s talks that ended without a breakthrough and prompted the United States to impose a naval blockade on the Strait of Hormuz.

Meanwhile, The Washington Post reported on Wednesday that the Pentagon is preparing to deploy thousands of additional troops to the Middle East in the coming days as the US steps up pressure on Iran to secure a deal, keeping uncertainty elevated.

Beyond geopolitical developments, Oil-driven inflation risks continue to shape expectations around the monetary policy outlook for both the Federal Reserve (Fed) and the European Central Bank (ECB). Although hopes of de-escalation have pushed Oil prices lower from recent highs, easing pressure on central banks to adopt a tightening stance.

However, Crude prices remain well above pre-conflict levels, leaving inflation risks firmly in focus. As a result, markets now expect the Fed to keep interest rates on hold in the coming months, while pricing in the possibility of potential rate hikes from the ECB.

Looking ahead, traders will closely watch the Eurozone inflation data due on Thursday after preliminary data showed a rise driven by higher Oil prices, lifting inflation above the ECB’s 2% target.

ECB policymaker Joachim Nagel said the April policy decision will hinge on developments around the Strait of Hormuz, stressing there is “not enough clarity” and that the ECB will keep “all optionality” open. Nagel added that there is no pre-commitment on rates and reiterated the ECB’s commitment to price stability.

Cleveland Fed President Beth Hammack said on Wednesday that “rates are in a good place,” adding that the baseline is to remain on hold “for a while.” 

Joachim Nagel, President of the Bundesbank and member of the European Central Bank (ECB) spoke in an interview with Bloomberg on Wednesday. He said that questions about the Strait of Hormuz are essential, as we're between the baseline and an adverse scenario.

Key takeaways:

There is not enough clarity about what happens in April, we need all optionality.

Question about Strait of Hormuz is essential, two weeks can bring a lot of new information.

Situation developed a little bit better over course of last week.

Inflation expectations well anchored but this could still change.

We're in between baseline and adverse scenario.

As long as situation around Hormuz is not resolved, the danger of higher inflation is rising.”

Rabobank Senior FX Strategist Jane Foley notes that while risk sentiment has improved and the Dollar’s safe-haven bid has faded, the physical Oil market tells a different story. With the Strait of Hormuz closed, she expects Oil flows to recover only to 80% of pre-war levels by late August, implying persistent inflation and demand disruption risks for energy importers.

Strait of Hormuz closure curbs flows

"It is, however, a different story in the physical oil market. The closure of the Strait of Hormuz suggests supply constraints are real and, RaboResearch forecasts that even if the war ends this month, oil supplies through the Strait will only be back at 80% of pre-war levels by late August."

"This suggests that the implication of the war for inflation and demand disruption is unavoidable."

"As energy importers, both the UK and the Eurozone are susceptible to the negative economic impacts of the spike in oil and gas prices. The terms of trade of both economies will worsen and inflation will rise."

"That said, within Europe some countries are more vulnerable to energy related price pressures than others, dependent on their energy mix. This has been reflected in bond yields across Europe in recent weeks."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

• Silver steadies near $80 as geopolitical risks and Fed outlook limit upside.
• Technically, XAG/USD trades within an upward-sloping channel on the 4-hour chart, maintaining a near-term bullish bias.
• Momentum indicators lean positive, with RSI approaching overbought conditions while MACD remains above the signal line.

Silver (XAG/USD) trades with a positive bias on Wednesday but lacks strong upside momentum as traders continue to monitor evolving geopolitical developments in the Middle East. At the time of writing, XAG/USD is trading around $80, hovering near one-month highs.

Meanwhile, the US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, is trading around 98.10, holding near the six-week low reached on Tuesday.

Silver remains on the front foot for an eighth consecutive day, supported by broad-based weakness in the US Dollar (USD) as market sentiment improves on hopes that the United States and Iran could reach a deal through renewed negotiations. However, the lack of strong follow-through buying suggests traders are staying on the sidelines, awaiting clearer signs of de-escalation.

At the same time, the Federal Reserve (Fed) is expected to keep interest rates on hold in the near term as policymakers assess the economic impact of the conflict, particularly Oil-driven inflation risks, which continue to cap the upside in non-yielding assets such as Silver. Although Oil prices have eased from recent highs and revived expectations that the Fed could resume rate cuts later in the year, the absence of a sustained decline in energy prices keeps the outlook uncertain.

From a technical perspective, the 4-hour chart shows XAG/USD trading within an upward-sloping parallel channel, marked by a sequence of higher highs and higher lows since bottoming near $61 in March. The metal has also climbed back above the 100- and 200-period Simple Moving Averages (SMAs), reinforcing a bullish bias in the near term.

Prices are now pressing against the upper boundary of the channel; a clear break and consolidation above would open the door to further gains within the prevailing uptrend, with the next resistance seen near $85. On the downside, a failure to hold above the 200-period SMA near $77 could expose the 100-period SMA around $73.

The Relative Strength Index (14) at 68.38 flirts with overbought conditions, and the Moving Average Convergence Divergence (MACD) indicator stays positive, hinting that upside momentum persists but may be at risk of fatigue near the channel ceiling, with the Average Directional Index (ADX) at 20.66 pointing to only modest trend strength.