Forex News
RaboResearch stresses that China’s production-oriented model, weakened by property and debt strains, increases reliance on manufacturing exports as US market access narrows. Beijing is unlikely to cut capacity or subsidies quickly, instead leveraging critical materials and supply chains for selective retaliation. This keeps Europe exposed to Chinese export pressure despite rising economic-security frictions.
Export-led model and retaliation leverage
"China's domestic weakness sharpens the problem. Its production-oriented economic model, compounded by the property downturn, debt overhang and weak domestic demand, reinforces reliance on manufacturing and exports."
"With the US market harder to access, Europe is an obvious outlet. Cheap, advanced imports benefit European buyers, but can also displace production, squeeze margins and deter investment. ECB research suggests these negative effects may dominate, without accounting for longer-term scarring or strategic vulnerabilities."
"For Beijing, rapid rebalancing is unattractive. Manufacturing supports growth, jobs, technological upgrading and autonomy while domestic demand remains weak. Cutting capacity, subsidies or exports would impose visible costs. The campaign against 'involution' acknowledges strain in China’s supply-driven model, not Europe's preferred remedy."
"Europe matters more as US access narrows. China therefore has reason to keep talks alive: a conflict would weigh on exports and add pressure on strained firms."
"China therefore has the tactical advantage in a sudden confrontation, while Europe’s position strengthens as the conflict lengthens, provided the EU remains united and reduces critical dependencies. That condition matters: a rising number of EU-sceptical leaderships could hollow out EU powers itself and/or obstruct cooperation. It could also weaken its soft power as perceived by outsiders, creating opportunities for external powers to exploit internal divisions."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
- USD/CHF tumbles below 0.8300 after failing to conquer 0.8400.
- RSI approaches bearish territory, signaling weakening bullish momentum.
- Break below 0.8227 confirms double top, exposing 0.8189 and 0.8116.
The USD/CHF pair struggles at 0.8250 on Thursday, diving below the 0.8300 figure as a ‘double top’ chart pattern looms on the daily chart, even though the overall trend is up. At the time of writing, the pair trades at 0.8269, down almost 1%.
USD/CHF Price Forecast: Technical outlook
The uptrend remains intact, as the market structure of higher highs and higher lows holds so far. Nevertheless, USD/CHF failed to conquer 0.8400 on Wednesday, exacerbating the pair’s drop below 0.8300.
On the other hand, momentum is shifting in favor of sellers, as indicated by the Relative Strength Index (RSI), with the index trending lower and poised to turn bearish.
Nevertheless, if buyers push USD/CHF above 0.8300, this paves the way to challenge the 0.8350 psychological level ahead of the yearly high of 0.8395. Once those levels are taken out, it would open the door to challenge 0.8400.
On the flip side, if USD/CHF extends its loss below the October 2 low of 0.8227, it would confirm the ‘double top’ and open the door for a move towards the 50-day Simple Moving Average (SMA) of 0.8189. The next support is the 100-day SMA at 0.8116.
USD/CHF Price Chart – Daily
(This story was corrected on October 15 at 20:05 GMT to say in the first paragraph that USD/CHF struggles at 0.8250, not 0.8350.)
Swiss Franc Price Today
The table below shows the percentage change of Swiss Franc (CHF) against listed major currencies today. Swiss Franc was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.44% | -0.56% | -0.09% | -0.30% | 0.77% | -0.34% | -0.86% | |
| EUR | 0.44% | -0.13% | 0.34% | 0.12% | 1.23% | 0.09% | -0.43% | |
| GBP | 0.56% | 0.13% | 0.46% | 0.25% | 1.33% | 0.22% | -0.31% | |
| JPY | 0.09% | -0.34% | -0.46% | -0.22% | 0.88% | -0.26% | -0.78% | |
| CAD | 0.30% | -0.12% | -0.25% | 0.22% | 1.07% | -0.03% | -0.56% | |
| AUD | -0.77% | -1.23% | -1.33% | -0.88% | -1.07% | -1.10% | -1.63% | |
| NZD | 0.34% | -0.09% | -0.22% | 0.26% | 0.03% | 1.10% | -0.55% | |
| CHF | 0.86% | 0.43% | 0.31% | 0.78% | 0.56% | 1.63% | 0.55% |
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 Swiss Franc from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CHF (base)/USD (quote).
Commerzbank analysts discuss Vietnam’s progress toward a US trade deal, which officials say is essentially complete and could be signed soon. The agreement aims to address tariffs, transshipment and regulatory standards, potentially easing a key growth headwind. Despite ongoing investigations and high duties, USD/VND has traded in a tight range as the State Bank of Vietnam stabilizes the fixing.
US deal and FX range trading
"Deputy Prime Minister Pham Gia Tuc said talks with the US on a trade deal are “essentially complete”, with Vietnam having submitted its final comments to US counterparts. He added that “We have sent the final comments to the US side and if both sides agree on this, we will sign the deal soon”. Key sticking points have included concerns over transshipment and non-tariff barriers."
"Vietnam currently faces a 12.5% tariff on exports to the US following a Section 301 investigation related to forced labour. The US Trade Representative has two ongoing investigations into Vietnam concerning industrial overcapacity and intellectual property (IP) protection. Separately, goods deemed to be transshipped face a 40% tariff."
"A favourable trade deal could ease a key headwind to Vietnam’s medium-term growth ambitions. The economy expanded 8.9% in the first three quarters of this year. It may come in below the government's target of 10%, as this would require a sharp acceleration to 12.5% in Q4."
"Given the importance of external demand, a deal that narrows Vietnam’s tariff differential with regional peers could improve its relative export competitiveness."
"In FX, USD/VND held steady around 25,893 yesterday. It has been range bound between 26,050-25,800 since mid-September. Over this period, the State Bank of Vietnam (SBV) has held the fixing rate steady to stem FX volatility."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
- Gold surges more than 1% to $4,148 despite hotter-than-expected US producer inflation.
- The 10-year Treasury yield tumbles 10 basis points, weakening the US Dollar.
- October Fed hike odds fall to 26% ahead of Warsh's speech.
Gold price climbs after another US inflation report on Thursday. Although the snapshot of US wholesale inflation came in hotter than expected, it was already priced in by investors, who trimmed their hawkish bets on the Federal Reserve (Fed). That produced a tailwind for the yellow metal, which benefits from lower interest rate environments. The XAU/USD trades at $4,148, up 1.1%.
Bullion rebounds as falling Treasury yields and reduced October Fed hike bets lift Bullion
Bullion prices recovered following a red-hot US Consumer Price Index (CPI) report on Wednesday, which prompted investors to increase hawkish Fed bets. Nevertheless, toward the end of the session, traders reduced those bets ahead of the release of Thursday's Producer Price Index (PPI).
The US PPI in September jumped above the 6% threshold, largely due to a rise in energy prices. The headline print exceeded estimates of 5.3%, surging to 6.3% YoY, while underlying inflation jumped from 4.8% to 5%, also above forecasts.
The Greenback and US Treasury yields initially steadied, before weakening, a tailwind for the precious metal. The US Dollar Index (DXY), which measures the performance of the buck’s value against a basket of six peers, edged down 0.4% to 102.11. At the same time, the yield of the US 10-year benchmark bond fell ten basis points to 5.089%.
After the data release, money markets now expect a 26% chance of a 25-basis-point rate hike by the Fed at the October 28 meeting, though for December they priced in a 92% chance.
In the meantime, Federal Reserve officials, led by San Francisco Fed President Mary Daly and Governor Michelle Bowman, stated that an immediate rate hike might not be needed.
US Retail Sales in September also cooled from 1.3% to 0.8% MoM but came in better than economists' projections of 0.3%. Further data showed that Initial Jobless Claims for the week ending October 10 came at 199K, below forecasts of 200K.
Investors are also looking for comments from Fed Chair Kevin Warsh at the International Monetary Fund's annual meeting, looking for clues ahead of this month's Fed meeting.
XAU/USD technical analysis: Gold jumps back above $4,100 but remains bearish
On Wednesday, Gold reached a weekly low of $4,073, but during Thursday’s sessionit reclaimed the $4,100 mark and is hovering near $4,150. Despite this, the Relative Strength Index (RSI) remains bearish but is showing signs that buyers are moving in.
For a bullish reversal, buyers need to clear $4,200 before testing the 100-day Simple Moving Average (SMA) at $4,245. Above lies the 50-day SMA at $4,334.
For a bearish continuation, the first support for XAU/USD is $4,100. A decisive breakdown will expose the October 14 low of $4,073, then the July 29 cycle low at $3,996, and finally the July 17 low at $3,959. Below that is the yearly low at $3,941.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
- USD/CAD slides to a two-week low as falling US Treasury yields drag the US Dollar lower.
- Strong US economic data support expectations of another Fed rate hike by December.
- The Fed-BoC interest rate differential remains a key headwind for the Loonie.
USD/CAD loses nearly 0.30% on Thursday as falling US Treasury yields weigh on the US Dollar (USD). Concerns over debt-funded AI investments drive investors away from equities and into government bonds. The Greenback weakens despite stronger-than-expected US economic data reinforcing expectations of further Federal Reserve (Fed) interest rate hikes.
At the time of writing, the pair trades around 1.4189 after touching an intraday low of 1.4169, its lowest level in two weeks.
Data released on Thursday showed that the Producer Price Index (PPI) rose 1.3% MoM and 6.3% YoY in September, exceeding forecasts of 0.5% and 5.3%, respectively. Core PPI, which excludes food and energy, increased 0.7% MoM and 5% YoY, also beating estimates of 0.3% and 4.4%.
Retail Sales increased 0.8%, above the 0.3% forecast, following an upwardly revised 1.3% rise in August. Weekly Initial Jobless Claims came in at 199K, slightly below expectations of 200K and up from 198K the previous week.
The figures follow Wednesday’s Consumer Price Index (CPI) report, which showed headline inflation accelerating to 3.7%, above the 3.6% forecast, while core inflation rose to 2.6%, exceeding expectations of 2.5%.
Together, resilient consumer spending and sticky inflation, driven partly by higher energy prices linked to the war in the Middle East, strengthen expectations of another Fed rate hike before year-end. According to the CME FedWatch Tool, traders expect a pause in October following September’s 25-basis-point hike, while pricing in around a 90% chance of another increase by December.
Against this backdrop, the US Dollar may avoid a deeper sell-off, limiting the Canadian Dollar’s recovery. The Loonie also faces a headwind from Canada’s relatively low interest rates compared with those in the United States. The Bank of Canada (BoC) has kept its policy rate unchanged at 2.25% so far this year.
The bar for a rate increase remains high, as the inflationary impact of elevated energy costs has so far been limited, with underlying inflation near the BoC’s 2% target. A weak labour market and uncertainty surrounding US trade policies also give policymakers reasons to remain cautious, although markets anticipate a rate hike by December.
Canadian Dollar Price Today
The table below shows the percentage change of Canadian Dollar (CAD) against listed major currencies today. Canadian Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.53% | -0.59% | -0.09% | -0.34% | 0.77% | -0.37% | -0.85% | |
| EUR | 0.53% | -0.07% | 0.41% | 0.16% | 1.32% | 0.13% | -0.33% | |
| GBP | 0.59% | 0.07% | 0.48% | 0.23% | 1.37% | 0.21% | -0.27% | |
| JPY | 0.09% | -0.41% | -0.48% | -0.25% | 0.89% | -0.30% | -0.76% | |
| CAD | 0.34% | -0.16% | -0.23% | 0.25% | 1.12% | -0.02% | -0.51% | |
| AUD | -0.77% | -1.32% | -1.37% | -0.89% | -1.12% | -1.14% | -1.62% | |
| NZD | 0.37% | -0.13% | -0.21% | 0.30% | 0.02% | 1.14% | -0.49% | |
| CHF | 0.85% | 0.33% | 0.27% | 0.76% | 0.51% | 1.62% | 0.49% |
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 Canadian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent CAD (base)/USD (quote).
Christopher Wong at OCBC Bank highlights that Monetary Authority of Singapore (MAS) kept its appreciating S$NEER policy stance unchanged after two prior tightening rounds, with output gaps and inflation forecasts suggesting less urgency for further moves. USD/SGD has been driven mainly by broader US Dollar strength and US yields, and Wong expects the pair to stay sensitive to external data, with MAS policy still offering underlying support for the Singapore Dollar.
MAS stance and USD drive USDSGD
"SGD weakened on Wednesday, though much of the move was driven by broad USD strength following stronger-than-expected US CPI rather than MAS’s decision to keep policy unchanged."
"MAS kept policy on hold after tightening twice in April and July. The accompanying statement pointed to a narrowing positive output gap through 2027, while the 2026 core inflation forecast range was narrowed to 1.5–2.0%. While inflation risks remain tilted to the upside, MAS appears to see less urgency for further tightening, with the cumulative effects of earlier policy adjustments and the existing appreciating S$NEER path providing sufficient monetary restraint for now."
"Importantly, a policy hold does not amount to easing, as the appreciating S$NEER stance remains intact. The on-hold decision saw a 20bp decline in our S$NEER to around 1.65% above the model-implied policy midpoint, from 1.85% before the announcement. We expect this deviation to hold largely steady after the adjustment."
"We expect USD/SGD to remain sensitive to broader USD sentiment in the interim. A sustained rise in USD could keep the pair supported, although MAS’s existing appreciating policy stance should continue to provide some underlying support for SGD."
"If the spike fails to build on momentum, then the pair may well revert back to consolidation in previous range of 1.2760 – 1.2840. But if price action is sustained, then bullish pressure may gather further momentum, and the pair may well see 1.28 – 1.29 range take hold."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)
The US Dollar (USD) has come under strong and renewed downside pressure on Thursday, briefly revisiting the area of multi-day lows amid the equally marked decline in US Treasury yields across the board and a generalised cautious tone amid market participants.
The US Dollar Index (DXY) has broken below the 102.00 support level, briefly slipping back to multi-day lows on the back of the widespread retracement in US Treasury yields. Closing the docket will be Export/Import Prices, Industrial/Manufacturing Production, Capacity Utilisation and Net Long TIC Flows. In addition, Fed Chair Warsh will speak at the IMF-World Bank annual meetings in Singapore.
The fresh weakness hurting the Greenback has lifted EUR/USD to weekly tops past the key 1.1200 barrier. clinched fresh 17-month lows near the 1.1100 level on the back of the strong upside momentum in the US Dollar. The final Inflation Rate in the euro area is due alongside Balance of Trade results.
GBP/USD has faded Wednesday’s deep pullback, managing to challenge the area of multi-day highs past 1.3270. Absent data releases on the UK docket, investors will closely follow remarks from the BoE’s Bailey.
USD/JPY has added to the ongoing correction, revisiting the 157.50 region in tandem with fresh USD selling. The weekly Foreign Bond Investment figures will be the sole data release on the domestic calendar.
AUD/USD has unexpectedly collapsed to three-month lows, piercing the 0.6900 yardstick in response to disheartening results from the Australian labour market report. Next of note for the Aussie will be Monday’s release of GDP data in China alongside Industrial Production, Retail Sales and the Unemployment Rate.
Front-month WTI futures have picked up extra pace, flirting with the area of four-week tops near the $97.00 mark per barrel amid steady uncertainty in the Middle East crisis along with supply concern fears.
Gold has traded with modest gains, always below the $4,200 mark per troy ounce in a context of fresh downside pressure on the US Dollar and a marked retracement in US Treasury yields across the curve.
- DXY round-trips Wednesday's CPI spike and drops to a six-session low.
- Money leaves AI stocks for Treasuries, and the 10-year hits a three-week low.
- Fed Chair Warsh speaks in Bangkok Friday, a day before Fed officials go quiet.
An artificial intelligence (AI) stock rout has pushed money into Treasuries, and the Dollar Index gave back its gain on Wednesday's Consumer Price Index (CPI) print. It dropped from Wednesday's high just under 103.00, its highest in 18 months, to just under 101.90, its lowest since October 7. A spike to about 102.25 on the producer price release was gone by the next five-minute bar.
Higher US rates raised the cost of the debt behind the AI data centre build, and bond yields for the most indebted builders hit records as their shares fell. State Street puts the hedged share of foreign-owned US stocks below 15%, against about 25% in April, so foreigners who sell US tech and take the money home sell Dollars. The rout reaches the Dollar twice, through the 10-year yield's fall to a three-week low and through that selling.
US producer prices rose 1.3% in September, above the 0.5% forecast, with energy accounting for about half. Retail sales rose 0.8%, but the control group rose 0.1% and gas stations took $4.1 billion of the $5.7 billion gain, on the same gasoline that lifted producer prices. The 10-year yield fell after the biggest jump in producer prices since March 2022.
On the calendar
Cleveland Fed President Hammack, who said on October 12 she'd rather hike in small steps quickly than wait, speaks at 20:30 GMT on Thursday. She didn't back a move at the October 27-28 meeting, and bets on a hike there are back near one in four, where they began the week. A December hike is priced near 90%.
Fed Chair Warsh speaks at the International Monetary Fund (IMF) meetings in Bangkok at 03:30 GMT on Friday, and Fed officials stop commenting publicly from October 17. September industrial production follows at 13:15 GMT, forecast up 0.4% after a flat August.
On the charts
The index broke above the 101.75-102.60 range it had held since October 5 on Wednesday's spike, and it's back in the middle of it near 102.10. The drop from that high to Thursday's low is about a quarter of the climb that started near 98.60 on September 9. Daily momentum has dropped out of overbought for the first time since late September.
DXY daily chart
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.
- The New Zealand Dollar gains ground against the US Dollar, supported by falling US Treasury yields.
- Reserve Bank of New Zealand Chief Economist Paul Conway signals that further interest rate hikes remain likely.
- Stronger-than-expected US producer inflation and expectations of additional Fed tightening could limit the pair's upside.
NZD/USD trades around 0.5600 on Thursday at the time of writing, gaining 0.18% on the day. The New Zealand Dollar (NZD) benefits from a weaker US Dollar (USD), as falling US Treasury yields and hawkish comments from the Reserve Bank of New Zealand (RBNZ) support the currency. However, stronger-than-expected US inflation data could limit further gains.
The US Dollar comes under pressure as US Treasury yields retreat sharply, despite Wednesday's stronger-than-expected Consumer Price Index (CPI) figures. Investors remain convinced that the Federal Reserve (Fed) will leave interest rates unchanged at its October meeting, reducing immediate support for the Greenback.
Meanwhile, a Bloomberg report suggests that China is transferring US securities to custodian banks outside the United States. This development contributes to the decline in US Treasury yields, encouraging profit-taking on the US Dollar after it recently reached an 18-month high.
On the New Zealand side, RBNZ Chief Economist Paul Conway provided additional support to the Kiwi by maintaining a hawkish stance on monetary policy. Conway indicated that the central bank's interest rate decision scheduled for late October remains completely open, while emphasizing that the Official Cash Rate (OCR) is still most likely to increase, although the timing remains uncertain.
These comments reinforce expectations that the RBNZ could resume monetary tightening, potentially supporting the New Zealand Dollar through a more favorable interest rate outlook.
However, the latest US inflation figures could complicate the NZD/USD recovery. On Thursday, the US Bureau of Labor Statistics (BLS) reported that the Producer Price Index (PPI) rose by 6.3% YoY in September, compared with 5.6% in August and market expectations of 5.3%. Core PPI, which excludes food and energy prices, also comes in above expectations, rising by 5% YoY.
These figures highlight persistent inflationary pressures in the United States and strengthen the case for further monetary tightening by the Fed. According to the CME FedWatch tool, markets continue to price in a chance of more than 85% that the US central bank will raise interest rates again before the end of the year.
Geopolitical uncertainty could also limit the New Zealand Dollar's upside. Escalating tensions in the Middle East, particularly the confrontation between the US and Iran over the Strait of Hormuz, continue to support demand for safe-haven assets such as the US Dollar.
Looking ahead, investors will focus on Fed Chair Kevin Warsh's speech on Friday during the annual meetings of the International Monetary Fund (IMF) and World Bank in Bangkok. His remarks could provide further insight into the Fed's monetary policy outlook and influence the near-term direction of NZD/USD.
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.
- Silver stages a recovery as falling Treasury yields ease pressure on the non-yielding metal.
- The technical outlook remains bearish as XAG/USD trades below its key daily SMAs.
- The RSI near 36 signals weak momentum, while the MACD remains in negative territory.
Silver (XAG/USD) stages a rebound on Thursday after sliding nearly 6% the previous day. The recovery comes as mounting concerns over AI-related investments weigh on global equities and drive investors toward government bonds, triggering a sharp pullback in US Treasury yields and pushing the US Dollar (USD) lower. At the time of writing, XAG/USD trades around $57.05, up 2.54% on the day.
While the decline in the US Dollar and yields lifts the white metal, its recovery faces a challenge from expectations of additional Federal Reserve (Fed) rate hikes following back-to-back hotter-than-expected US CPI and PPI reports. Higher interest rates increase the opportunity cost of holding non-yielding Silver. According to the CME FedWatch Tool, traders expect the Fed to keep rates unchanged at its October 27-28 meeting, while pricing in around a 90% chance of a rate hike by December.
Technical analysis
On the daily chart, XAG/USD trades well below the 50-day, 100-day and 200-day Simple Moving Averages (SMAs), clustered between roughly $64 and $72. The Moving Average Convergence Divergence (MACD) remains negative, while the Relative Strength Index (RSI) is around 36, near oversold territory, suggesting persistent downside pressure but without capitulation, as the Average Directional Index near 24 hints at a gradually strengthening trend rather than an explosive selloff.
On the topside, initial resistance emerges at the 23.6% Fibonacci retracement at $58.27, followed by the 38.2% retracement at $60.04 and the 50.0% retracement at $61.47, before a denser barrier forms around the 61.8% retracement at $62.91 in conjunction with the clustered 100-day SMA at $63.24 and 50-day SMA at $64.11. Further up, the 78.6% retracement at $64.95 and the prior cycle high near $67.55 guard the path towards the distant 200-day SMA at $72.28.
On the downside, a sustained break below July’s lows in the $55.00-$55 area could open the door to a deeper decline toward $50. Holding this support zone could encourage a corrective bounce from oversold levels rather than a decisive trend reversal.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
(This story was corrected on October 15 at 17:50 GMT to remove an extra zero from the Silver price, which was $57.05, not $570.05.)
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
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