Forex News
- Gold edges lower on Thursday as uncertainty around US-Iran negotiations keeps markets on edge.
- Rising Oil prices are fueling inflation concerns, strengthening expectations of higher-for-longer interest rates.
- Technically, XAU/USD remains under pressure below the 100-day SMA, maintaining a short-term bearish bias.
Gold (XAU/USD) edges lower on Thursday, snapping a two-day winning streak as uncertainty surrounding US-Iran negotiations to end the conflict keeps markets on edge, with price action largely driven by hawkish global interest rate expectations stemming from an Oil-driven inflation shock.
At the time of writing, XAU/USD trades around $4,420, down roughly 1.9% on the day, retreating from Wednesday’s high near $4,602.
US-Iran talks remain unclear
While the United States (US) pushes for a diplomatic breakthrough, Iran has rejected a proposed 15-point plan, stating that any agreement would be on its own terms and only once its conditions are met, including security guarantees and recognition of its authority over the Strait of Hormuz.
Iran’s refusal of a proposed deal is increasing the risk of a prolonged conflict, especially with reports of additional US troop deployments to the region. Meanwhile, US President Donald Trump’s five-day pause on planned strikes is set to end later this week, keeping uncertainty high.
Liquidity demand and higher rate expectations pressure Gold
Despite ongoing geopolitical tensions, Gold has struggled to attract sustained demand, with the metal currently down over 15% from the March peak of $5,419, after briefly falling more than 20% from that high earlier this week.
Analysts suggest that traders are increasingly selling Gold to move into cash, primarily US Dollars (USD), to cover losses or margin calls in other assets amid heightened volatility across global markets. This shift toward liquidity is adding further pressure on the precious metal.
At the same time, rising Oil prices are fueling inflation concerns, prompting expectations that central banks may keep interest rates elevated for longer or even consider tightening if price pressure persists. Higher interest rates tend to weigh on Gold by reducing its appeal as a non-yielding asset.
Markets now expect the Federal Reserve (Fed) to keep rates on hold through 2026, rather than earlier expectations for at least two cuts. This repricing has pushed US Treasury yields higher, further limiting upside in the precious metal.
Looking ahead, traders will continue to monitor geopolitical developments for any signs of progress in US-Iran negotiations. However, given the current backdrop, upside in Gold is likely to remain capped unless a clear breakthrough leads to lower Oil prices and eases expectations for higher-for-longer interest rates.
Technical analysis: Bearish bias persists below 100-day SMA
From a technical perspective, XAU/USD near-term bias remains bearish after facing rejection at the 100-day Simple Moving Average (SMA) on the daily chart, following a rebound from the 200-day SMA earlier this week, which keeps the broader uptrend intact.
The Relative Strength Index (RSI) hovers in the low 30s after slipping below this level on Monday, showing persistent bearish momentum with only tentative signs of stabilization. Average True Range (ATR) has picked up from earlier lows, indicating that the latest leg lower unfolds with expanding volatility, which reinforces the downside risk in the short term.
On the upside, a sustained move above the 100-day SMA near $4,619 could ease bearish pressure and allow XAU/USD to test the 50-day SMA around $4,968, ahead of the $5,000 psychological level. A break above $5,000 would signal a return to a bullish bias.
On the downside, immediate support lies at Tuesday’s low near $4,306, followed by the 200-day SMA around $4,107.
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.
- GBP/JPY loses momentum after failing to extend gains past 213.30 highs.
- The risk-off sentiment is providing some support to the safe-haven Yen on Thursday.
- A break below the trendline support at 212.70 would confirm a bearish correction.
The Pound (GBP) is trading lower against the Japanese Yen (JPY) on Thursday, snapping a four-day positive streak. The pair has retreated to levels below 213.00 after failing to extend gains beyond the March top in the 213.30 area, with the risk-off sentiment strengthening the case for some correction.
News from the US-Iran war remains confusing as the Islamic Republic’s Foreign Minister, Abbas Araghchi, denied any direct talks with the US, while US President Donald Trump reiterates that Iranian leaders are begging to negotiate a peace deal. Meanwhile, Iran and Israel have kept exchanging attacks on Thursday. The Strait of Hormuz remains closed for the fourth consecutive week, boosting Crude Oil to levels of $99 per barrel
Technical Analysis
In the 4-hour chart, GBP/JPY trades at 212.83. The near-term bias remains bullish as the pair holds above the rising support trend line from 210.59, but failure to breach the resistance area around 213.30 and softening technical indicators are strengthening the case for a bearish correction.
The Relative Strength Index (RSI) has pulled back to 53, from levels around 60 on previous sessions, and the Moving Average Convergence Divergence (MACD) has slipped to marginally negative levels. Furthermore, the MACD line has crossed below the signal line, which suggests that bears are taking control.
Price action is now testing support at the bullish trendline from March 19 lows, now at 212,70. Further down, the March 24 low, at 212.26, will come to the focus ahead of the March 23 low, in the 211.60 area. Bulls, on the other hand, would have to breach the key resistance area at 213.30, aiming for the early February highs, at the 213.75 area and 214.05.
(The technical analysis of this story was written with the help of an AI tool.)
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.27% | 0.29% | 0.10% | 0.22% | 0.59% | 0.52% | 0.20% | |
| EUR | -0.27% | 0.02% | -0.18% | -0.05% | 0.35% | 0.25% | -0.07% | |
| GBP | -0.29% | -0.02% | -0.19% | -0.07% | 0.32% | 0.24% | -0.09% | |
| JPY | -0.10% | 0.18% | 0.19% | 0.11% | 0.49% | 0.39% | 0.09% | |
| CAD | -0.22% | 0.05% | 0.07% | -0.11% | 0.38% | 0.30% | -0.02% | |
| AUD | -0.59% | -0.35% | -0.32% | -0.49% | -0.38% | -0.07% | -0.37% | |
| NZD | -0.52% | -0.25% | -0.24% | -0.39% | -0.30% | 0.07% | -0.31% | |
| CHF | -0.20% | 0.07% | 0.09% | -0.09% | 0.02% | 0.37% | 0.31% |
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 Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
- Initial Jobless Claims increased to 210K vs. the previous week.
- Continuing Jobless Claims went down to 1.819M.
According to a report from the US Department of Labour (DOL) released on Thursday, the number of US citizens submitting new applications for unemployment insurance increased to 210K for the week ending March 21. The latest print matched initial estimates and was higher than the previous week’s 205K (unrevised).
Additionally, the 4-week moving average went down a tad by 0.250K, bringing it to 210.5K from the unrevised average of the previous week (210.75K).
The report also indicated that Continuing Jobless Claims fell by 32K to 1.819M for the week ending March 7.
Market reaction
The Greenback adds to the weekly recovery on Thursday, prompting the US Dollar Index (DXY) to hit three-day highs near the key 100.00 mark. The Greenback’s improvement remains well underpinned by unabated tensions in the geopolitical landscape.
Employment FAQs
Labor market conditions are a key element to assess the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and thus economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels and thus monetary policy as low labor supply and high demand leads to higher wages.
The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy.
The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given its significance as a gauge of the health of the economy and their direct relationship to inflation.
- USD/CHF ticks up slightly as the US Dollar holds firm.
- Tensions between the US and Iran boost demand for safe-haven assets.
- Swiss National Bank remains ready to intervene against excessive Franc strength.
USD/CHF trades higher around 0.7930 on Thursday, up 0.15% on the day, as the US Dollar (USD) maintains a bullish tone amid heightened geopolitical uncertainty. The pair is supported by sustained demand for the Greenback, driven by fading hopes for a ceasefire between the United States (US) and Iran.
The US Dollar Index (DXY), which tracks the USD against a basket of major currencies, is holding near recent highs around 99.90, reflecting the currency’s resilience. Tensions have escalated after Tehran rejected US President Donald Trump’s 15-point ceasefire proposal, describing it as “extremely maximalist and unreasonable.”
According to a report from the Wall Street Journal, Iran is demanding guarantees against any resumption of hostilities, an end to Israeli strikes on Hezbollah, and greater control over the Strait of Hormuz, including the right to collect transit fees. These conditions have been deemed unrealistic by US officials, further reducing the likelihood of a near-term agreement.
In this environment, risk aversion remains elevated, supporting flows into safe-haven assets such as the US Dollar. Recent comments from Donald Trump, stating that Iranian negotiators are “begging” for a deal while urging them to “get serious”, failed to improve market sentiment, with US Equity futures remaining under pressure.
Meanwhile, monetary policy expectations continue to underpin the USD. A Reuters poll shows that a majority of economists expect the Federal Reserve (Fed) to keep interest rates within the 3.50%-3.75% range at least until September, although rate cuts are still anticipated later this year amid persistent inflation.
On the Swiss side, the Swiss Franc (CHF) remains broadly stable against its major peers. However, the Swiss National Bank (SNB) has reiterated its readiness to intervene in foreign exchange markets to curb excessive appreciation of the currency. SNB Chair Martin Schlegel stated that the central bank has increased its willingness to act to limit sharp Franc gains.
Overall, the combination of a resilient US Dollar supported by safe-haven demand and a vigilant Swiss monetary policy backdrop keeps USD/CHF biased to the upside in the near term.
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 Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.22% | 0.23% | 0.08% | 0.24% | 0.51% | 0.47% | 0.17% | |
| EUR | -0.22% | 0.00% | -0.17% | 0.02% | 0.29% | 0.25% | -0.06% | |
| GBP | -0.23% | -0.00% | -0.15% | 0.01% | 0.29% | 0.24% | -0.06% | |
| JPY | -0.08% | 0.17% | 0.15% | 0.15% | 0.43% | 0.37% | 0.08% | |
| CAD | -0.24% | -0.02% | -0.01% | -0.15% | 0.28% | 0.23% | -0.07% | |
| AUD | -0.51% | -0.29% | -0.29% | -0.43% | -0.28% | -0.04% | -0.32% | |
| NZD | -0.47% | -0.25% | -0.24% | -0.37% | -0.23% | 0.04% | -0.30% | |
| CHF | -0.17% | 0.06% | 0.06% | -0.08% | 0.07% | 0.32% | 0.30% |
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).
OCBC strategists Sim Moh Siong and Christopher Wong highlight that the Pound (GBP) has been resilient since the Iran conflict, supported by a sharp hawkish shift in UK rate expectations. However, they see this repricing as excessive given slowing UK growth, energy-driven uncertainty and rising fiscal risks, and now expect a longer Bank of England (BoE) policy hold while turning more cautious on the GBP outlook.
Hawkish BoE bets seen overstretched
"GBP’s resilience reflects aggressive hawkish repricing, but the market’s shift looks overstretched against weakening growth, energy-driven uncertainty, and rising fiscal risks that leaves the GBP outlook less compelling."
"Despite being a net energy importer, the GBP has been one of the more resilient G10 currencies since the Iran conflict began, buoyed by a sharp hawkish shift in UK rate expectations."
"GBP held steady as slightly higher‑than‑expected UK CPI is unlikely to alter the Bank of England’s (BoE) policy path, which ultimately hinges on the scale and duration of the energy shock."
"Our expectation for a 3Q26 BoE rate cut now looks less assured, with an extended policy hold appearing more realistic. Still, the market’s aggressive hawkish repricing seems excessive given the UK’s slowing growth and the policy trade-offs that would emerge if energy prices stay elevated."
"Geopolitics has pushed domestic politics off the front page, but the energy shock and upcoming May local elections may raise the likelihood of more expansionary fiscal policy. These rising fiscal concerns leave us more cautious on the GBP outlook."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Societe Generale analysts comment on the latest Reuters European Central Bank (ECB) poll showing more economists now expect at least one rate increase this year, though a majority still see no move. They highlight President Lagarde’s readiness to hike if inflation pressures from the Iran conflict intensify, while stressing it is still early to act as policymakers gauge the energy-driven shock.
Lagarde keeps options open on policy
"In the latest Reuters ECB poll published yesterday, the number of economists forecasting at least one rate increase this year rose to 21 from 3 in March. Out of a pool of 60, that’s still 39 economists or 65% who do not expect the bank to raise rates which seems elevated considering the repricing of the money market curve over the past three weeks."
"President Lagarde yesterday signalled that the bank is ready to raise rates at any meeting if inflation pressures from the Iran conflict intensify. In her view, it is still too early to act, with policymakers assessing the scale and persistence of the energy-driven price shock. "
"Lagarde highlighted that the ECB cannot influence energy prices directly and will instead monitor spillovers to core inflation, wages and price expectations."
"Nagel chipped in with hawkish comments this morning, adding to the bear flattening momentum in 2s/10s and 5s/30s. Spreads have basically completed the reversal to the levels of last March when Germany loosened the debt handbrake and announced the fiscal bazooka, targeting spending in defense and security. The 5y5y inflation swap closed yesterday at 2.12%, the lowest since 4 March."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Commerzbank analysts Michael Pfister and Norman Liebke report that the Bank of Mexico (Banxico) is expected to leave rates unchanged, with markets no longer pricing cuts in the near term after the Iran conflict. They still see scope for two or three 25 bp cuts over 2026, but stresses there is currently no concrete trigger, so today’s decision should have limited impact on the Mexican Peso (MXN).
Banxico seen on extended hold
"... the Mexican central bank (Banxico) is meeting today. Neither the markets nor analysts surveyed by Bloomberg expect an interest rate cut. Although market expectations were around 12 basis points higher before the outbreak of conflict in Iran, it would be inaccurate to suggest that there were genuine expectations of a rate cut."
"We have repeatedly stated that Banxico is likely to cut its key interest rate two or three times by 25 basis points each over the course of the year. However, there is at this point in time no concrete reason for this. On the one hand, the Mexican central bank - like other central banks - is likely to wait and see what impact the conflict in Iran has on inflation and the global economy."
"On the other hand, the monetary authorities are adopting a wait-and-see approach to better assess the consequences of the minimum wage increase and other political measures introduced at the start of the year."
"Although recent economic indicators, such as monthly economic activity and industrial production, have been significantly weaker recently, this is unlikely to be sufficient to justify an interest rate cut given the current uncertainties. Therefore, the actual decision is unlikely to play a significant role for the peso given market expectations."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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