Forex News

OCBC strategist Christopher Wong highlights that Singapore Dollar (SGD) remains largely driven by the broader Dollar story after the FOMC, given its high sensitivity to USD moves. He maintains a cautious stance on SGD if US Dollar Index (DXY) and front-end US yields extend higher, with USD/SGD temporarily supported. However, he notes that softer US activity, labour-market or inflation data could see USD/SGD downside re-emerge.

Singapore Dollar tied to US data

"SGD may still see some weakening pressure alongside the broader USD move after the FOMC, given its relatively high sensitivity to shifts in the USD. We would retain a slight cautious stance on SGD if DXY and front-end US yields extend higher through the Asian session."

"The Fed’s hawkish shift may keep USD/SGD temporarily supported in the near term, however this does not change the broader sensitivity to US data. If incoming US activity, labour market or inflation readings begin to soften and rate expectations are pared back, downside in USD/SGD could re-emerge."

"Daily momentum is bullish but RSI rose to near overbought conditions. Price action suggests a potential hanging man pattern with death cross in the making (50 DMA cuts 200 DMA to the downside)."

"We watch further price action for confirmation for any bearish reversal or if bearish signals are being nullified. Area of resistance at 1.2790 (50% fibo retracement of 2026 low to high) - 1.2810 (50, 100, 200 DMAs). Next level at 1.2840 (38.2% fibo). Support at 1.2740 (61.8% fibo), 1.27 (21 DMA)."

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

MUFG’s Lloyd Chan remains cautious on the Thai Baht, keeping the USD/THB forecast at 34.00 by year-end. The report argues that Thailand’s electronics export boom is offset by deteriorating terms of trade, weak GDP growth, low Bank of Thailand rates, persistent foreign portfolio outflows, and rising fiscal constraints, leaving the Baht under sustained downside pressure.

Electronics gains offset by macro headwinds

"We remain cautious on THB and maintain our USD/THB forecast of 34.00 by end-year. While Thailand is benefiting from the technology cycle, stronger electronics exports are insufficient to offset deteriorating terms of trade, weak growth, low rates, persistent portfolio outflows, and rising fiscal constraints."

"Thailand's electronics boom is generating less FX support than headline export growth suggests. Thailand is a net importer of semiconductors required for electronics production. Rising chip prices and higher imported content have increased the electronics import bill, limiting the net electronics trade gains."

"Thailand faces a broader commodity shock that is weighing on external balances. Terms of trade have fallen to a 27-year low, given higher prices of energy, metals, and intermediate goods."

"The growth backdrop suggests scope for higher USD/THB. US growth remains resilient, while Thailand's GDP growth slowed to 1.9%yoy in Q2, with net exports posing a major drag on Thailand’s growth."

"BoT policy rate remains at just 1.0% and is likely to stay there into early 2027, even as the Fed has raised rates and could tighten more in the coming months. Low BoT rates, along with baht overvaluations, persistent net foreign portfolio outflows, and limited fiscal capacity to cushion the oil shock impact, should keep THB under pressure."

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

Here is what you need to know for Friday, September 18:

The US Dollar (USD) is ending Thursday softer. The US Dollar Index (DXY) hovers just above the 100.00 mark after climbing to a seven-week high earlier in the week. The sideways action follows Wednesday's decision by the Federal Reserve (Fed) to raise interest rates for the first time since 2023. The hike briefly lifted the Dollar, but the move faded as energy prices came off their highs and President Donald Trump renewed his demand for sharply lower rates.

The Fed's message was clearly hawkish with Chair Kevin Warsh flagging that another hike could still come this year, which should keep a floor under the Greenback. A sharp rally in Gold and a steadier tone in equities point to firmer risk appetite as traders turn to a busy Friday dominated by the Bank of Japan (BoJ).

EUR/USD clings to modest gains in the high-1.1400s, holding firm as the softer Dollar lends support.

GBP/USD stays on the back foot in the mid-1.3300s, unable to recover after the Bank of England's cautious hold.

USD/JPY drifts lower toward the 156.00 region as traders brace for a widely expected BoJ rate hike.

AUD/USD has extended its rebound into the low-0.7100s, the day's strongest major as risk appetite improves.

Gold has surged, pushing above $4,350 per troy ounce and building on a powerful run.

West Texas Intermediate (WTI) Oil holds above the $100.00 mark, steadying after its recent pullback.

• XAG/USD surges as RSI climbs back above neutral territory.
• A break above $66.56 exposes $67.00 and $70.00 resistance.
• Failure below the neckline revives downside toward $62.86 and $60.00.

Silver (XAG/USD) surges to five-day highs above $66.00 on Thursday as traders digest the Federal Reserve (Fed) rate hike on Wednesday. Meanwhile, a drop in US Treasury yields is undermining the Greenback, which clings to early gains but has barely changed. At the time of writing, XAG/USD trades at $65.41, up over 3.90%.

XAG/USD Price Forecast: Technical outlook

Even though the ‘head-and-shoulders’ chart pattern remains in play, a potential breakout of the neckline can negate the bearish formation. The Relative Strength Index (RSI) shows bullish momentum is building, with the RSI clearing its 50-neutral level and trending higher.

With that said, the first resistance for XAG/USD is the 100-day Simple Moving Average (SMA) at $66.56. A breach of the latter will expose the $67.00 mark as the white metal embarks on a journey to reclaim $70.00. Above these levels sits the 200-day SMA at $73.16.

On the other hand, if Silver dives below the ‘head and shoulders’ neckline, it can clear the way for a potential resumption of the downtrend. The first line of defense is the 50-day SMA at $62.86, ahead of the March 23 swing low at $61.01, ahead of the $60.00 mark. Below the next support is the ‘head-and-shoulders’ measured objective near $55.00.

XAG/USD Price Chart – Daily

• Gold clears the 100-day SMA as falling yields revive demand.
• Fed hike fails to derail bullion as October odds for another rate raise stay elevated.
• Oil pullback eases inflation pressure, helping XAU/USD target $4,400.

Gold (XAU/USD) rallies on Thursday, up by more than 2% as investors digest the latest rate hike by the Federal Reserve (Fed), while a fall in Oil prices pushed the US Dollar and US yields lower. The XAU/USD pair trades at $4,361, clearing a key technical resistance level at the 100-day Simple Moving Average (SMA) of $4,320, as buyers set their sights on $4,400.

XAU/USD clears key resistance as lower yields overpower Fed’s hawkish message

A potential de-escalation of the Middle East conflict underpins the non-yielding metal, benefiting from lower Oil prices. West Texas Intermediate (WTI), the US crude benchmark, is down by about 0.16%, undermining the Greenback given its positive correlation.

The US Dollar Index (DXY), which measures the buck’s performance against six currencies, is down 0.12% at 100.22. At the same time, US Treasury yields erased some of Wednesday’s hawkish Fed-tilt, down 7 basis points to 4.949%.

A day ago, the Federal Reserve raised rates as expected, 25 basis points to the 3.75%-4% range, the first in three years, opening the door for further tightening as the US central bank recognises that the economy remains growing strongly.

Fed Chair Kevin Warsh said that “the fact is that inflation is too high and has been for too long.” The Fed dot plot, in which officials express their expectations for the path of interest rates, shows the Fed funds rate hovering around 4.10% at the end of 2026, suggesting another rate increase is expected in the foreseeable future. This is in line with their inflation expectations, as the Personal Consumption Expenditures (PCE) price index is expected to remain at 3.7% this year and converge toward the Fed’s 2% goal through 2028.

Money markets have priced in a 53% chance of another rate hike at the October meeting, according to Prime Terminal.

Regarding data, the US economic report showed that jobless claims for the week ending September 12 fell significantly from 206K to 196K, below the expected 208K.

On Friday, the US economic schedule will feature the Fed’s August Industrial Production report and a speech by Fed Governor Michelle Bowman.

XAU/USD technical analysis: Gold may challenge $4,400 on a close above $4,367

Price action in the short-term is poised for a recovery as a ‘bullish engulfing‘ candle pattern develops. If Gold closes above the September 16 high of $4,366, this could confirm a bullish recovery, but buyers must push prices above $4,500.

The Relative Strength Index (RSI) is trending higher but remains below its 50 neutral level, indicating neither buyers nor sellers are in control. However, if it clears 50 , further upside in Gold is expected.

XAU's first resistance is $4,400, followed by the psychological levels of $4,450 and $4,500. Once cleared, the next area of interest is the 200-day SMA at $4,540.

On the downside, Gold could register another leg lower if it drops below the 100-day SMA at $4,323, then the $4,300 mark. If achieved, the non-yielding metal will fall further, with the next support level the 50-day SMA at $4,283, followed by the July 6 high-turned support at $4,202.

• AUD/JPY rises for a fourth session to 111.00 while NZD/JPY holds its weakest level since February.
• Speculators flipped from a 92.2K Yen short to a net long in a single week.
• Japan's rate may reach 1.25% on Friday, its highest since 1993.

The Australian Dollar (AUD) trades near 111.00 against the Japanese Yen (JPY) and the New Zealand Dollar (NZD) near 89.50 on Thursday, both a little higher and both a long way below where they were in August. The Bank of Japan (BoJ) is expected to raise its rate to 1.25% on Friday, and that decision is supposed to be the thing that breaks the trade that borrows Yen cheaply to buy currencies paying more. The funds that publish their positions were out of it more than a week ago.

What the trade pays after Friday

The mechanics are plain. Borrow Yen at 1%, buy Australian Dollars earning 4.35% or New Zealand Dollars earning 2.75%, and keep the difference for as long as the exchange rate does not move against you. After Friday, Australian Dollars earn 3.10% more than the Yen costs to borrow and New Zealand Dollars earn 1.50% more, before anyone counts hedging or the spread.

At 89.42, that 1.50% comes to about one and a third Yen a year. NZD/JPY has fallen more than six Yen since its August high near 95.00, which is more than four years of the rate difference gone inside a month. AUD/JPY earns about three and a half Yen a year and has lost five since its own August high near 115.00. Nobody rebuilds a position that size for interest it can lose in a fortnight.

The unwind was published on September 12

Large speculators in the Commodity Futures Trading Commission (CFTC) data went into September net short 92.2K Yen contracts, near the biggest bet against the currency since 2007. In the week to September 8 that position improved by about 103K contracts and turned into a net long of 10.8K, the largest weekly swing since early August. The traders who are supposed to be caught by Friday spent the preceding week getting out of the way.

That is one slice of the book and not all of it. Banks and the leveraged money that borrows Yen directly file no weekly report, and the two pairs say the selling has not entirely stopped. What the futures data does say is that the crowd is now long the Yen, which is the side that loses if BoJ Governor Ueda sounds more careful than money markets expect.

Japanese institutions file no weekly report either. Japan's 10-year government bond yield is at a three-decade high, and every step up in it gives Japanese life insurers and pension funds a reason to bring savings home from Sydney and Auckland rather than send more out. Those transfers do not show up in a weekly number and they do not reverse on a press conference. They are why 3.10% a year does not go far against a move of two Yen.

New Zealand beat its forecast and made a new low anyway

New Zealand's economy grew 0.2% in the second quarter against a 0.1% forecast, which cleared the bar and still came to a fifth of the 0.9% managed the quarter before. The Reserve Bank of New Zealand (RBNZ) raised its rate to 2.75% on September 2 and its own forecasts leave room for one more increase this year. Headline inflation there is 4.1% and 2.9% once vehicle fuel comes out, so the bank is raising rates into an oil price rather than a spending boom.

Australia is the stronger of the two. The Reserve Bank of Australia (RBA) held its cash rate at 4.35% in August and meets again on September 29, underlying inflation is 3.6%, and the four largest Australian banks now all forecast an increase before the end of the year. That gap is why AUD/JPY is still above its 200-day average near 110.00 while NZD/JPY trades more than two Yen below its own, at the weakest level since February.

What lands before the decision

RBA Governor Bullock speaks at 23:30 GMT, and the 4.35% cash rate is the number she can change on September 29. Japan's national Consumer Price Index (CPI) for August arrives at the same time, with the measure that strips out fresh food forecast at 1.8% and unchanged. New Zealand's trade figures come at 22:45 GMT, and the country imports its fuel, so a barrel near $97.50 widens that deficit.

The decision itself lands on Friday, with the statement at 03:00 GMT and the press conference at 06:30 GMT. A quarter-point to 1.25% is priced at about 97%, which makes it the least informative part of Friday. Money markets price roughly nine-tenths of a point of further increases over the following twelve months, and that is the number Governor Ueda either confirms or does not. A rate at 1.25% would be the highest in Japan since 1993, and it still leaves the Yen the cheapest funding currency in the developed world.

The guidance has a political constraint on it. Prime Minister Sanae Takaichi has been arguing for easier money to support growth, and her spending plans are part of why long Japanese yields are where they are. Governor Ueda has to signal more increases without picking a fight with the government that appoints his board, which is the sort of drafting problem that produces a cautious sentence and a two-Yen move in the crosses.

Levels and bias

Resistance: 111.00 is the level AUD/JPY has just reached for the first time in a week, and 111.50 is where the August slide paused. NZD/JPY has been capped at 89.50 for four sessions, with 90.00 the level it lost on September 11.

Support: AUD/JPY traded under its 200-day average near 110.00 on September 14 and has held above it since, which leaves that day's low just above 109.50 as the next floor. NZD/JPY has 89.00 beneath it and then the September 15 low at 88.96.

Bias: Higher on AUD/JPY while 110.00 holds. The objectives are 111.50 and then 112.50, and the case is wrong on a daily close below 109.50. NZD/JPY stays the weaker leg while 90.00 caps it, aiming at 89.00 and then 88.50, and a daily close above 90.00 ends that one. The daily Stochastic Relative Strength Index (Stoch RSI), a momentum gauge, reads near 13 on the Australian cross and near 5 on the New Zealand one, both at the bottom of their ranges.

AUD/JPY Daily chart

NZD/JPY Daily chart

Commerzbank’s China-focused FX Research highlights that PBoC Governor Pan Gongsheng framed weaker loan growth as part of structural upgrading, signalling no imminent credit-driven stimulus. The central bank appears comfortable with lower credit expansion even as US–China tariff-reduction talks progress ahead of the Xi–Trump summit.

Credit slowdown and trade diplomacy

"In an article published in the Communist Party’s policy journal Qiushi, the People's Bank of China (PBoC) Governor Pan Gongsheng framed the slowdown in loan growth as a structural feature of economic upgrading rather than a sign of distress. The remarks followed August credit data that showed aggregate financing and loan expansion weakening more than expected, with M2 money supply growth also undershooting consensus."

"By validating the trend, the governor effectively signaled that the PBoC is not preparing an imminent credit-driven stimulus response. The credit deceleration reflects a broader demand-side adjustment. Households and corporates are reducing their appetite for new borrowing as the property sector continues to weigh on balance sheets and consumer confidence remains subdued."

"PBoC’s comfort with lower credit growth reduces the probability of near-term monetary easing. With fiscal policy yet to deliver a decisive impulse and domestic demand still soft, the policy burden is shifting towards trade diplomacy as the preferred primary near-term growth lever. A constructive outcome from the US-China summit could provide a modest boost to sentiment."

"However, the simultaneous pressure from the EU and the Fed’s renewed tightening cycle creates a challenging external backdrop for Chinese policymakers heading into year-end."

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

• WTI round-trips from $94.50 back to $97.50 as Saudi Arabia reroutes cargoes.
• The East-West pipeline that moves up to 5 million barrels a day is shut.
• Gulf of Oman ship transfers are running at 2.7 million barrels a day.

Crude Oil trades near $97.50, which is where it opened on Thursday, after a drop to $94.50 and a full recovery. Saudi Arabia is offering Asian refiners extra cargoes handed over outside the Strait of Hormuz, and the price treated that as more oil. The five daily closes before this one all landed between $96.50 and $101.00, which is a market that keeps buying and selling the same story.

The cargoes still cross the strait

A ship-to-ship transfer is a hand-off, not a route. Shuttle tankers load Saudi crude at the Gulf terminals, carry it through the Strait of Hormuz, and pass it to the buyer's vessel waiting off Sohar in Oman. What moves is the risk. The Asian refiner's supertanker stays out of the Gulf and a smaller ship makes the transit in its place, and the oil takes the trip it always took.

The volumes say the same thing. Transfers in the Gulf of Oman are running near 2.7 million barrels a day against 1.5 million in August, which is more cargo through the same chokepoint rather than cargo going around it. That chokepoint carried nearly 20 million barrels a day of crude and products in 2025, about a quarter of the world's seaborne oil trade, and no workaround built since February has replaced more than a slice of it. War-risk cover for one Hormuz transit was quoted at 7.5% to 12.5% of a ship's insured value before this month's escalation, against 0.25% before the war. Saudi Arabia has also doubled daily loadings at its Ras Tanura and Juaymah terminals to about two supertankers, roughly 4 million barrels, all of it inside the Gulf. That bill did not fall because Saudi Aramco found somewhere to park a tanker.

Aramco says days and the repair estimates say weeks

The route that genuinely avoids the strait is the East-West pipeline, 1,200 kilometres from the eastern oil fields to Yanbu on the Red Sea and rated at 5 million barrels a day. Houthi drones damaged it and the kingdom shut it on September 11, which is what carried Crude Oil to just above $102.00 on September 15. Regional officials put the repair at three to five weeks. Aramco has said it expects to bring about half the capacity back within days.

Until it runs again, every Saudi barrel sold into Asia has to cross Hormuz, and buyers waiting on the Red Sea route have been told their loadings are late. Some European cargoes due this month were cancelled outright. The arithmetic is not close. The pipeline is rated at 5 million barrels a day, and the extra transfers in the Gulf of Oman since August come to about 1.2 million. The transfers off Oman move the queue rather than the pipeline.

The price has already run this experiment

News of a meeting on a shipping arrangement for the strait took about four dollars off the price on September 11. Two sessions later Crude Oil made the high of the move just above $102.00. A meeting is not a barrel, a hand-off between two tankers is not a barrel either, and the market needed one session to work that out both times. The same thing happened inside a single session this time, and the low at $94.50 did not last.

Inventories are not the constraint. Commercial crude stocks in the United States fell 600K barrels in the week to September 11, to 423.4 million, and distillate stocks rose. The tightness is in tanker capacity and war-risk insurance in the Gulf, and neither of those is measured in an American tank farm.

What moves the price from here is the pipeline. A restart sends Saudi crude back to the Red Sea and off the strait, which is worth more than every hand-off off Sohar put together. A repair that runs past three weeks leaves those barrels on the water with the insurance bill attached. The Houthis who damaged the pipeline have said Saudi-linked vessels are still targets, so the repaired route delivers to a coast that is also being shot at.

Levels and bias

Resistance: $100.00 capped four sessions running into Wednesday. Each of them traded above it and only one had a close above it. Above that, $102.00 is the high of the move, made on September 15.

Support: $94.50 is the session low and the weakest level since September 10. Beneath it, $93.00 is where that September 10 flush stopped.

Bias: Higher while $94.50 holds, with $100.00 the first objective and $102.00 the second. The daily Stochastic Relative Strength Index (Stoch RSI), a momentum gauge, is near 89 and flat at the top of its range, so the next attempt at $100.00 needs a headline rather than momentum. A daily close below $93.00 ends the bullish case.

WTI daily chart

• EUR/GBP has pushed toward the 0.8600 barrier, reaching multi-day highs as the Pound (GBP) weakens.
• The BoE held the interest rate at 3.75% in a 6-3 vote, its sixth hold in a row, with three members again pushing for a hike.
• Despite warning that inflation risks are tilted higher, the majority signaled no rush to act.

EUR/GBP is trading higher on Thursday, climbing toward the 0.8600 barrier and touching its highest in several days. The Pound has slipped across the board after the Bank of England (BoE) held interest rates and struck a more cautious tone than much of the market had priced in.

The BoE kept the Bank Rate at 3.75%, its sixth consecutive hold, in a 6-3 vote. The three dissenters, the same members as in July, wanted an immediate quarter-point rise to 4.00%. UK inflation is running at 3.1%, well above the 2% target and at a five-month high, and the Bank said price risks are tilted further to the upside, warning that a hike is becoming more likely.

Governor Andrew Bailey pointed to energy price swings from the Middle East conflict, warning that "the longer this volatility persists, the bigger the impact it will have". However, Bailey stressed the central bank's job is to keep any rise in inflation temporary.

Attention now turns to UK Retail Sales for August, the next release on the calendar, with forecasts pointing to another small drop for the month. Beyond that, the BoE does not meet again until November, when fresh forecasts arrive and the case for a hike gets properly tested. Until then, EUR/GBP is likely to take its cue from whether the market keeps trimming its bets on BoE tightening.

Technical analysis:

In the four-hour chart, EUR/GBP trades at 0.8597, keeping a moderately bullish tone as the pair holds above both the 100-period Simple Moving Average (SMA) at 0.8578 and the 20-period SMA at 0.8569. The cross is also supported by nearby horizontal demand at 0.8593, while the Relative Strength Index (14) at 65 suggests firm but not yet extreme buying pressure, hinting that bulls still have room to probe higher levels.

On the topside, immediate resistance is seen at the horizontal barrier around 0.8603, followed by a stronger cap at 0.8607, where a break would likely extend the current advance. On the downside, initial support aligns with the 0.8593 level, ahead of a secondary floor at 0.8581, while deeper pullbacks would look toward the 100-period SMA at 0.8578 and then the 20-period SMA at 0.8569 as more substantial bullish checkpoints.

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

United Overseas Bank’s (UOB) Quek Ser Leang and Lee Sue Ann note USD/SGD surged to 1.2784 and closed at 1.2783, its largest one-day gain in three months, with strong momentum despite overbought conditions. Their Singapore Dollar (SGD) Nominal Effective Exchange Rate (NEER) model suggests USD/SGD should trade between 1.2725 and 1.2785 intraday, while the 1-3 weeks view stays constructive as long as the pair holds above support at 1.2710.

Dollar strength tests key Singapore levels

"24-HOUR VIEW: While we held the view yesterday that USD “could edge higher,” we pointed out that “it remains to be seen if it can break above 1.2755.” However, during the NY session, USD rallied sharply to 1.2784 before posting its largest one-day gain in three months as it closed at 1.2783 (+0.42%). While strong momentum could outweigh the current deeply overbought conditions, it remains to be seen whether USD can reach 1.2800. Given the overbought conditions, the next resistance at 1.2835 is unlikely to come under threat. Support is at 1.2760; the next support at 1.2740 should hold for now."

"1-3 WEEKS VIEW: Tracking our positive view from last Friday, we highlighted two days ago (15 Sep, spot at 1.2700) that “the price action suggests that USD could continue to rise toward 1.2755.” Yesterday, we stated that “looking ahead, the next level to watch above 1.2755 is 1.2775.” We did not expect USD to clear both levels so easily, as it subsequently rallied to a high of 1.2784. The outlook for USD remains positive, and the levels to watch are 1.2800 and 1.2835. Overall, only a breach of 1.2710 (‘strong support’ level was at 1.2680 yesterday) would indicate that USD is not strengthening further. Near-term, 1.2740 is already a firm support level."

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