Forex News
US President Trump announced the most severe economic action ever taken against Iran, CBS News reported on Wednesday. Trump said this will be economic conflict and isolation on an unprecedented scale and the countries allowing financial aid to Iran will face severe economic consequences.
"No one has given the Islamic Republic of Iran a greater opportunity to make a Deal than me. TRAGICALLY, for them, they have failed to take it," Trump wrote on Truth Social.
" … ANY country that allows its financial institutions, businesses, airports, or government entities to provide any type of lifeline to Iran will itself face TREMENDOUS Economic Consequences. Oil smuggling, swap lines, cash transfers, exchange houses, ship registries, front companies — It all needs to stop NOW. You know who you are," the US President added.
Earlier, Trump said that Washington might return to negotiations with Iran eventually, but said currently "the situation is so good.”
Meanwhile, the United Arab Emirates (UAE) announced it is suspending all trade with Tehran after two ballistic missiles targeted the UAE. Iran denied firing the missiles.
Market reaction
At the time of writing, the West Texas Intermediate (WTI) is up 0.02% on the day at $85.28.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
- Gold price jumps to near $4,520, hitting a two-month high in Thursday’s early Asian session.
- The Treasury said it’s ramping up a buyback program for longer-dated securities.
- Fed Minutes indicated they would need to raise rates soon unless there was more progress on bringing down inflation.
Gold price (XAU/USD) rises to around $4,520 during the early Asian session on Thursday. The precious metal surges to the highest since early June amid the weakening US Dollar (USD) after the US Treasury Department stepped in to provide relief to bond markets.
The Treasury Department is ramping up a buyback program for longer-dated securities to rein-in long-term borrowing costs from multi-year highs. TD Securities said the Treasury's announcement gave metals a "jolt of life," saying gold investment could "quickly return amid Treasury liquidity support, a Fed willing to look through an energy shock, and a growing stagflation narrative, which should all ultimately see lower real rates.”
The Federal Reserve's (Fed) latest July meeting minutes indicated many policymakers saw rate hikes likely if inflation did not decline. The Fed decided to keep the Federal Funds Rate targeted in a range between 3.5%-3.75% last month, with dissenters focusing on the need for action soon to return inflation to target.
Nonetheless, traders are largely looking through this due to rising stagflation fears and an energy shock narrative, driving money back into gold as a safe-haven.
Gold upside seen as US Treasury support points to lower real rates
According to TD Securities, the recent moderation in the “fierce bid” for Gold may prove temporary, with the bank arguing that “the flows could quickly return amid Treasury liquidity support, a Fed willing to look through an energy shock, and a growing stagflation narrative, which should all ultimately see lower real rates.” In their view, this combination of renewed US Treasury buybacks, a tolerant Fed stance on energy-driven price pressures, and rising stagflation concerns reinforces the case for renewed upside in precious metals.
Technical Analysis: Gold resumes its uptrend in the near term
In the daily chart, XAU/USD retains a bullish near-term bias as price holds well above the 20-period Bollinger simple moving average and the 100-day simple moving average (SMA), keeping the broader uptrend intact. Price is approaching the upper Bollinger band, while the Relative Strength Index (14) around 67 points to overbought conditions that could temper immediate upside, even as momentum still favors buyers.
On the topside, initial resistance is located at the upper Bollinger band near $4,550, where a clear daily close above would open the way to fresh record territory. On the downside, immediate support is seen at the 100-day SMA around $4,380, followed by the mid-Bollinger band at $4,225, with the lower Bollinger band at $3,905, marking a more distant structural floor in the event of a deeper corrective pullback.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
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.
- AUD/USD advances as Treasury buyback pressures Dollar lower.
- Hawkish Fed minutes show tightening risk if inflation stalls.
- Australia jobs data and US PMIs drive next catalysts.
The Aussie Dollar advances on Wednesday, up over 0.56%, as the US Dollar registers losses amid the US Treasury bond buyback and despite the release of hawkish Federal Reserve minutes from the July meeting. The AUD/USD trades at 0.7127.
AUD/USD climbs as lower US yields offset hawkish Fed minutes
The US Treasury buyback of long-end bonds revealed that the Treasury is worried about elevated yields. Since the beginning of the US-Iran war, US yields have remained near the year's highs, as energy prices have stayed high amid hostilities that threaten to affect one-fifth of global Oil production.
The US Treasury program is expected to last from September 9 to November 4, during which the US Treasury will double purchases of long-end bonds from 2 billion to at least 4 billion, in an effort to modestly influence the yield curve.
In the meantime, the Federal Reserve released its July meeting minutes, noting that dissenters recognised inflation as broad-based and favoured a more “restrictive policy.” The minutes showed that policymakers are concerned about inflation, with many considering that policy tightening would likely be necessary if inflation did not decline.
In the minutes, the new Fed Chair, Kevin Warsh, asked if the US central bank should hold six meetings, allowing two months for data review. The 2026 schedule remains unchanged.
Ahead, traders eye the speech by Fed Chair Kevin Warsh at the beginning of the Jackson Hole Symposium at the end of August, which Fed officials usually use to outline the future of interest rates for the second half of the year.
In Australia, traders eye the release of employment data. The Employment Change in July is expected to show a deceleration of firing, from 76.3K in June to 15K in July, with the Unemployment Rate poised to remain steady at 4.4%, unchanged,
In the US, the economic schedule will feature Initial Jobless Claims, a speech by St. Louis Fed President Alberto Musalem and S&P Global Flash PMIs.
AUD/USD Price Forecast: Technical outlook
In the daily chart, AUD/USD trades at 0.7127, extending its advance above the cluster of underlying demand defined by the simple moving average triple (SMA) set at 0.6996 and the nearer rising trend-line floor around 0.6967. Price location above these supports sets a constructive near-term bias, while the Relative Strength Index (14) at 66 suggests firm but increasingly stretched bullish momentum as the pair approaches the upper band of a broader ascending structure.
On the topside, initial resistance is located in the 0.7297–0.7309 band, where overlapping upward trend lines could slow further gains before higher barriers emerge toward 0.8433 and 0.9150. On the downside, immediate support is found at the recent breakout area around 0.7127, followed by the short-term rising trend-line near 0.6967 and the grouped simple moving averages at 0.6996, with the earlier downtrend-line break at 0.6399 marking a deeper structural floor should a more pronounced correction unfold.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Australian Dollar Price Today
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.86% | -0.51% | -0.87% | -0.66% | -0.55% | -1.02% | -1.82% | |
| EUR | 0.86% | 0.33% | -0.04% | 0.20% | 0.30% | -0.19% | -0.97% | |
| GBP | 0.51% | -0.33% | -0.34% | -0.13% | -0.01% | -0.50% | -1.31% | |
| JPY | 0.87% | 0.04% | 0.34% | 0.21% | 0.31% | -0.16% | -0.97% | |
| CAD | 0.66% | -0.20% | 0.13% | -0.21% | 0.10% | -0.38% | -1.18% | |
| AUD | 0.55% | -0.30% | 0.01% | -0.31% | -0.10% | -0.47% | -1.26% | |
| NZD | 1.02% | 0.19% | 0.50% | 0.16% | 0.38% | 0.47% | -0.80% | |
| CHF | 1.82% | 0.97% | 1.31% | 0.97% | 1.18% | 1.26% | 0.80% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
- GBP/JPY falls below 50-day SMA after failing near 216.00.
- Bearish RSI signals sellers are gaining control of momentum.
- Break below 214.75 exposes 212.45 and August low.
The GBP/JPY retreats on Wednesday as the cross-pair fails to climb past 216.00 and fell beneath the 50-day Simple Moving Average (SMA) of 125.56. The cross-pair trades at 214.25 down 0.37%.
GBP/JPY Price Forecast: Technical outlook
The GBP/JPY is neutral biased, with the pair holding below the 50-day SMA, with traders eyeing the 100-day SMA at 214.75, which could’ve opened the door for further losses. The next support would be the 200-day SMA at 212.45, followed by the August 7 low of 211.47.
The Relative Strength Index (RSI) reveals that sellers are gaining momentum, an indication that bears are in control.
On further strength, the GBP/JPY first resistance is the April 10 high of 216.60, followed by 217.’00. Above this area ists the July 10 high of 218.69, ahead of the July 15 high at 219.61.
GBP/JPY Price Chart – Daily
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.85% | -0.50% | -0.89% | -0.64% | -0.52% | -0.99% | -1.80% | |
| EUR | 0.85% | 0.33% | -0.04% | 0.21% | 0.31% | -0.20% | -0.97% | |
| GBP | 0.50% | -0.33% | -0.34% | -0.13% | -0.02% | -0.51% | -1.31% | |
| JPY | 0.89% | 0.04% | 0.34% | 0.23% | 0.34% | -0.15% | -0.96% | |
| CAD | 0.64% | -0.21% | 0.13% | -0.23% | 0.11% | -0.38% | -1.19% | |
| AUD | 0.52% | -0.31% | 0.02% | -0.34% | -0.11% | -0.49% | -1.28% | |
| NZD | 0.99% | 0.20% | 0.51% | 0.15% | 0.38% | 0.49% | -0.80% | |
| CHF | 1.80% | 0.97% | 1.31% | 0.96% | 1.19% | 1.28% | 0.80% |
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 British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
- USD/JPY closed 0.92% lower, the largest decline since the intervention.
- Japan's policy rate is 1.00% against a 3.50% to 3.75% American band.
- July trade data at 23:50 GMT, national inflation 24 hours later.
USD/JPY closed Wednesday 0.92% lower just above 158.00, the largest single-session decline since the early-August intervention, and Tokyo did not lift a finger for it. The Yen's best session since Tokyo last spent money defending it was delivered instead by the United States Treasury, which was not aiming at the Yen and never mentioned it. The pair ended the session sitting on its 200-day Exponential Moving Average (EMA).
The Yen trades the American long end, not Tokyo
The Treasury said it would at least double the size of its liquidity support buyback operations in longer-dated bonds, taking each operation from 2 billion Dollars to at least 4 billion, effective September 9 through November 4. The thirty-year had printed above 5.33% on August 18, its highest since June 2007, and gave back close to ten basis points inside the afternoon, with the ten-year easing toward 4.65%.
Japan's policy rate is 1.00% against a 3.50% to 3.75% band in the United States, so this pair is a spread instrument wearing a currency ticker. Intervention moves the spot rate and leaves the spread exactly where it was, which is why a record joint operation of 8.45 trillion Yen in a single session, followed by roughly 5.3 trillion more alongside the American Treasury, bought about eight big figures and surrendered close to half of them inside a fortnight. A bond notice aimed at the 20-year sector took more than a hundred pips out of the pair in two hours.
Tokyo's own long end belongs to the same problem. Japanese government bond yields have been climbing alongside American ones, so the differential that drives this pair stayed wide even while both curves sold off, and a domestic argument over swelling budget requests and how a consumption tax cut gets funded keeps that premium in place. The absence of any follow-up operation through the first half of August was all speculators needed to take back half the intervention move without a fight.
September was Tokyo's problem and Washington just eased it
The Bank of Japan (BoJ) held at 1.00% in July while warning that underlying inflation could overshoot its target, and market pricing for a September increase now sits just under 80%, up from around 65% in the first week of August. That case rests on imported inflation rather than domestic strength. Wholesale prices rose 7.2% annually in July and the Yen-based import price index rose 29.1%, which is the exchange rate arriving in the price level.
The domestic side is not carrying the argument at all. Second-quarter Gross Domestic Product (GDP) grew 1.1% annualised against a 2% consensus, weak household demand offsetting robust exports. A tightening justified by a weak currency gets harder to justify every time somebody else strengthens that currency, and Wednesday's work was done by a Washington bond desk rather than by anything said in Tokyo.
That is the loop worth holding onto through the next four weeks. Every big figure the Dollar surrenders on American fiscal news takes a slice out of the imported-inflation case that the September hike is built on, which means a Yen strengthened from the outside quietly lowers the odds of the domestic tightening that would strengthen it from the inside. A currency rescued by somebody else's balance sheet does not get to keep the rescue.
Trade tonight, national inflation tomorrow
July trade figures land at 23:50 GMT Wednesday, with the total merchandise balance forecast at a 680 billion Yen deficit against a 406.9 billion prior. Exports are seen at 19.9% annually from 19.3% and imports at 26.5% from 25.4%. Imports outrunning exports by that margin is the war's energy bill and the currency's arithmetic printed on the same line, and it is the deficit rather than the export headline that decides how the Asian session reads it.
National inflation follows at 23:30 GMT Thursday, the reading excluding fresh food forecast at 1.8% from 1.6% with the headline and core series both carrying a 1.7% prior. Both national gauges sit beneath the 2% target while wholesale prices run above 7%, and that split is what the September decision has to resolve. A firm print hardens the hike case. A soft one leaves the Yen holding a Dollar story it has no control over.
Japanese Yen levels
Resistance: 158.50 is the first line, then the session high near 159.50, with the declining 50-day E
xponential Moving Average (EMA) just beneath 160.50 capping any recovery. A daily close back above 159.50 puts the August range back in play.
Support: The 200-day EMA just beneath 158.00 is the line the session stopped on, then 157.50 and the 156.50 area, with the intervention low just above 155.00 the structural floor. Daily Stochastic Relative Strength Index (Stoch RSI) near 32 has room lower before it becomes an argument for a bounce.
Bias: Bearish beneath 159.50, objectives 157.50 then the 156.50 area, invalidation on a daily close back above 159.50.
USD/JPY daily chart
Japanese Yen FAQs
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
- GBP/USD closed 0.53% higher, the best close in three months.
- UK core inflation held at 2.6% against a 2.5% consensus.
- Retail sales and August PMIs both forecast lower on Friday.
GBP/USD closed Wednesday 0.53% higher just above 1.3600, its best close in three months, and the United Kingdom inflation report that opened the session had almost nothing to do with it. Sterling spent the London morning up barely twenty pips on the day. The entire advance arrived after midday, when a Treasury notice in New York pulled the floor out from under the Dollar.
An energy cap is not a hike case
Annual Consumer Price Index (CPI) inflation rose to 2.9% in July from 2.6%, matching consensus and marking the first increase in the headline rate since March. Core held at 2.6% against a 2.5% forecast, the only line on the page that beat. Services inflation, the series the Bank of England (BoE) actually watches, slowed to 3.4% from 3.6%.
The composition kills the hawkish reading. The move came out of a 13.5% increase in the regulated household energy cap that took effect in July, with domestic gas prices up 14.7% on the month, against transport inflation falling to 3.6% from 5.7% on cheaper diesel and food easing to 1.3%. That is an administered price working through an index rather than domestic demand pushing on it, and a committee that already held 6-3 in July has been handed no new reason to move on September 17.
None of it was a surprise to the people setting the rate. The July projection already had inflation peaking near 3.2% in the final quarter of the year on exactly this energy passthrough, which means Wednesday's rise was forecast, absorbed and priced long before it printed. Tuesday's labour market report had gone the other way and pressured Sterling, so the pair arrived into Wednesday carrying a domestic negative and left it carrying a foreign positive.
The move was made in Washington
The Treasury said on Wednesday it would at least double the size of its liquidity support buyback operations in longer-dated bonds, taking each operation from 2 billion Dollars to at least 4 billion from September 9. Long yields fell hard, the thirty-year giving back close to ten basis points from a print above 5.33% the previous day, and the Dollar was sold against every major counterpart into the American afternoon.
Sterling was not among the leaders of that move. The Swiss Franc gained close to 1.8% against the Dollar on the session and the New Zealand Dollar roughly 1%, which is what a broad unwind looks like when the seller is indifferent to what it buys instead. A three-month high built on another country's fiscal housekeeping is a Dollar position wearing a Sterling label, and it cleared the moving average band near 1.3400 that capped this pair through June and July with no domestic catalyst in it anywhere.
The mechanism is worth naming because it decides how durable the level is. An issuer announcing that it will buy back more of its own long-dated paper reduces yields by supplying a bid rather than by improving the inflation outlook, and currency markets treat those two routes to the same yield very differently. Gold ran toward $4,500 an ounce on the same news, which is not the behaviour of a market that thinks American inflation risk just fell.
Every British number left this week is forecast lower
GfK consumer confidence for August lands Thursday at 23:01 GMT with a consensus of -18 against a -17 prior. Friday opens at 06:00 GMT with July retail sales, forecast at -0.5% on the month against a 1% prior, -0.5% excluding fuel from 1.1%, and 2.2% annually against 4.2%. The annual line roughly halving is the number that matters, because it converts one soft month into a direction.
The preliminary August S&P Global Purchasing Managers Index (PMI) series follows at 08:30 GMT, composite at 51.5 from 52.2, services 51.8 from 52.1 and manufacturing 51.5 from 51.9. Every domestic release left on the week is forecast beneath its prior, which leaves the Pound at its best level since May going into a calendar consensus already expects to disappoint. The Dollar leg is the only thing holding this trade together, and it is the only leg worth watching.
Pound Sterling levels
Resistance: The session high short of 1.3650 is the first barrier, then the early-May peak just above 1.3650, with 1.3700 the level that turns this into a trend break rather than a Dollar accident.
Support: The 1.3600 handle now has to hold as the floor of the breakout, then 1.3550, with the 50-day Exponential Moving Average (EMA) near 1.3450 and the 200-day near 1.3400 far beneath. Daily Stochastic Relative Strength Index (Stoch RSI) near 90 sits deep in overbought territory and argues for consolidation before any extension.
Bias: Bullish while 1.3550 holds, objectives the early-May peak just above 1.3650 then 1.3700, invalidation on a daily close back beneath 1.3550.
GBP/USD daily chart
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
- NZD/USD climbs toward its highest since early June, holding north of the 0.5930 mark.
- A sharp drop in US Treasury yields after the Treasury's buyback plan has broadly weakened the US Dollar, lifting the Kiwi.
- The Reserve Bank of New Zealand's (RBNZ) hawkish lean adds support, with the July FOMC minutes read as backward-looking.
The New Zealand Dollar (NZD) rallies against the US Dollar (USD), pushing north of the 0.5930 mark. The move is driven by broad weakness in the Greenback rather than anything out of New Zealand.
The trigger was the United States (US) Treasury Department. It said it will at least double its buyback operations for longer-dated coupon securities in the 10-year to 20-year and 20-year to 30-year sectors, lifting each operation from $2 billion to at least $4 billion between September 9 and November 4. The plan aims to support liquidity and cap the recent climb in long-end yields. It worked quickly, with the US 10-year yield falling back toward 4.65% after trading above 4.70% earlier in the day.
The July Federal Open Market Committee (FOMC) minutes, released on Wednesday, did little to change the picture. The record showed policymakers still regard inflation as elevated and confirmed three officials voted for a hike, but traders treated it as backward-looking given the softer inflation and weak jobs data since the meeting. A September hold remains the base case, keeping the Dollar on the back foot.
Attention now turns to New Zealand's July trade balance on Thursday, though the bigger driver for NZD/USD remains the US side, with the path of yields and the Dollar setting the tone into the end of the week.
Short-term technical analysis:
On the 4-hour chart, NZD/USD trades at 0.5932. The pair retains a constructive near-term bias as it holds above both the 20-period Simple Moving Average (SMA) at 0.5896 and the 100-period SMA at 0.5868, suggesting underlying demand on dips. Momentum is firm, with the Relative Strength Index (RSI) hovering near 68, hinting at strong bullish pressure without yet crossing into extreme overbought territory.
On the topside, immediate resistance is seen at 0.5935, followed by a nearby cap at 0.5939; a sustained break above this cluster would open the way toward 0.5965. On the downside, initial support emerges at 0.5929, ahead of a secondary floor at 0.5922, with the 20-period SMA at 0.5896 and the 100-period SMA at 0.5868 reinforcing a broader bullish structure on any deeper pullback.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
- The Australian Unemployment Rate is forecast to hold steady at 4.4% in July.
- Australia is expected to have added 15K jobs in the month, fewer than the 76.3K gained in June.
- AUD/USD gains upward momentum ahead of the Australian employment report.
Australia will release the July monthly employment report on Thursday at 01:30 GMT. Ahead of the announcement, analysts anticipate a modest 15K increase in job creation, while the Unemployment Rate is expected to remain steady at 4.4%. The Australian Bureau of Statistics (ABS) report is also expected to show that the Participation Rate stood at 66.9% in the month following the 67% recorded in the previous month.
ABS separately reports full-time and part-time positions through the monthly Employment Change. Generally speaking, full-time jobs entail working 38 hours or more per week, usually include additional benefits, and typically provide a consistent income. On the other hand, part-time employment generally means higher hourly rates but lacks consistency and benefits. That’s why the economy prefers full-time jobs. In June, Australia added 47K part-time positions and a modest 29.3K full-time ones.
Australian unemployment rate seen steady in July
The soft anticipated figures could have a near-term negative impact on the Australian Dollar (AUD), although market attention remains elsewhere: the Middle East.
While Australian employment data can shape future Reserve Bank of Australia (RBA) monetary policy decisions, policymakers are clearly focusing on inflation. At the August meeting, the Board decided to keep the Official Cash Rate (OCR) unchanged at 4.35%, as expected.
“While the impact of the Middle East conflict on inflation has so far been less than expected, headline inflation is still too high. Trimmed mean inflation also remains elevated and is little changed from the March quarter. Oil and most related commodity prices remain higher than they were prior to the Middle East conflict,” the RBA’s August statement reads.
Inflation risks are tilted to the upside, while “labour market conditions have eased by a little more than expected in recent months. Labour market leading indicators point to only limited easing in the near term,” the statement adds, suggesting that the anticipated soft outcome will be considered encouraging by the RBA rather than a new point of concern.
Regarding the United States (US)-Iran war, there’s not much new going on, and that’s actually concerning. Both sides refrain from launching fresh attacks on the other, yet negotiations to end the conflict seem utopian at this point. Each side's demands are a line the other side will not cross. As a result, Oil prices are slowly but steadily rising, which ultimately exacerbates and confirms inflation-related concerns.
Back to the Australian employment data release, and as previously mentioned, the anticipated figures are expected to have a negative, yet temporary impact. A much better-than-anticipated outcome could spur some near-term AUD demand, yet whether the currency could sustain such gains will depend on risk-related sentiment and US Dollar (USD) weakness or strength.
When will the Australian employment report be released and how could it affect AUD/USD?
The ABS July employment report will be released early on Thursday. As previously noted, the Australian economy is expected to have added 15K new jobs in the month, while the Unemployment Rate is forecast at 4.4%. Market participants will also be attentive to the breakdown of full-time and part-time positions.
Valeria Bednarik, Chief Analyst at FXStreet, notes: “The AUD/USD pair trades around the 0.7100 mark amid broad USD weakness, not far below the August peak at 0.7129. Technically, the pair is bullish, with the daily chart showing buyers aligned around the 100-day Simple Moving Average (SMA) at around 0.7060. The 20-day SMA meanwhile advances below the longer one, signaling increased buying interest. Finally, technical indicators in the same chart remain within positive levels, although lacking clear directional strength.”
Bednarik adds: “ As long as the pair holds above the mentioned 0.7060 region, the bullish stance will remain in place regardless of intraday movements. Below the level, however, the retracement can extend towards the 0.7030 price zone before buying interest shows signs. Immediate near-term resistance is located at 0.7030, while additional gains could see AUD/USD reaching 0.7070 before some selling interest appears.”
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.
Economic Indicator
Unemployment Rate s.a.
The Unemployment Rate, released by the Australian Bureau of Statistics, is the number of unemployed workers divided by the total civilian labor force, expressed as a percentage. If the rate increases, it indicates a lack of expansion within the Australian labor market and a weakness within the Australian economy. A decrease in the figure is seen as bullish for the Australian Dollar (AUD), while an increase is seen as bearish.
Read more.Next release: Thu Aug 20, 2026 01:30
Frequency: Monthly
Consensus: 4.4%
Previous: 4.4%
Source: Australian Bureau of Statistics
The Australian Bureau of Statistics (ABS) publishes an overview of trends in the Australian labour market, with unemployment rate a closely watched indicator. It is released about 15 days after the month end and throws light on the overall economic conditions, as it is highly correlated to consumer spending and inflation. Despite the lagging nature of the indicator, it affects the Reserve Bank of Australia’s (RBA) interest rate decisions, in turn, moving the Australian dollar. Upbeat figure tends to be AUD positive.
- DXY closed 0.86% lower, the weakest close since mid-May.
- Long-end buyback operations at least doubled to 4 billion Dollars.
- Hawkish July minutes landed at 18:00 GMT and moved nothing.
The Dollar Index closed Wednesday 0.86% lower just beneath 98.80, its weakest close since mid-May, and it closed on the session low. The document that did the damage was not a central bank document. A Treasury notice on the government bond buyback programme, released in the middle of the London afternoon, took the currency apart against every major counterpart on the board and left the index almost a full point under its 200-day Exponential Moving Average (EMA).
The debt manager wrote the session
The Treasury said it would increase, by at least double, the size of its liquidity support buyback operations in longer-dated nominal coupons, taking each operation from 2 billion Dollars to at least 4 billion across the 10-to-20-year and 20-to-30-year sectors. The change runs from September 9 through November 4, with anything beyond that left to the November refunding. It arrived barely two weeks after the quarterly buyback schedule had been published, and it arrived in front of a 16 billion Dollar auction of 20-year paper.
Long yields did what an announced buyer makes them do. The thirty-year had printed above 5.33% on August 18, its highest since June 2007, and it gave back close to ten basis points inside the afternoon, with the ten-year easing toward 4.65%. Long yields falling on disinflation leave a currency roughly where they found it. Long yields falling because the issuer had to show up as a bidder are something else entirely, and the foreign exchange market priced the difference within minutes.
The selling was indiscriminate, which is the tell worth keeping. The Swiss Franc took close to 1.8% out of the Dollar on the session, the New Zealand Dollar roughly 1%, and the Mexican Peso ran to a two-year high. Gold climbed toward $4,500 an ounce with Silver alongside it. A currency losing ground to a funding currency, a high-yielder and a metal inside the same afternoon is not repricing a rate spread. It is repricing the issuer.
The minutes nobody traded
The record of the July 28-29 Federal Open Market Committee (FOMC) meeting arrived at 18:00 GMT and described a committee considerably more hawkish than its own vote tally. Several policymakers favoured an immediate increase against the three who actually dissented, many judged that tightening would probably become necessary if inflation failed to decline, and a few argued that moving early would spare the committee larger moves later.
The language matters more than the arithmetic here, because the account of the June meeting credited only a few participants with a hike case. The ladder has climbed a rung while the vote has not moved at all, and two regional presidents without a vote in July have since said they would have backed an increase. The hawkish bloc is wider than the vote count showed, and it is still widening.
For all of that, the currency market treated the release as a non-event. The index was already sitting at its lows when the document landed and it stayed there. Futures had already trimmed September increase odds to roughly a third from around two-thirds in the days after the meeting, and nothing in the record put them back. A committee that switched off forward guidance on purpose now competes for attention with a debt manager who has not.
The week's real tests come after the minutes
Thursday's American calendar opens at 12:30 GMT with initial jobless claims against a 210K consensus and a 209K prior, alongside the Philadelphia Fed manufacturing survey for August, where a consensus of 25 sits against a 41.4 prior. That is a forecast collapse of more than sixteen points in a regional survey, and a print anywhere near it will do more to September pricing than a three-week-old account of a meeting. A regional Fed president speaks at 15:10 GMT.
Friday brings the preliminary August S&P Global Purchasing Managers Index (PMI) series at 13:45 GMT, manufacturing at a 53.8 consensus from 53.9 and services at 54 from 54.6, with the composite prior at 54.5. Both are forecast to soften without breaking, which is the shape that keeps a September hold alive without arming a cut. Beyond that sits the Jackson Hole symposium at the end of the month, the next scheduled chance for the Federal Reserve to take the narrative back off the Treasury.
Dollar Index levels
Resistance: The 99.00 handle is the first line back, with the 200-day EMA near 99.75 above it and the 50-day EMA just above the 100.00 handle capping the recovery case. Nothing short of a reclaim of 99.75 repairs the daily structure.
Support: The session low in the 98.75 area is the immediate shelf, then 98.50 and the 98.00 handle, with the early-May base near 97.60 the only structural level beneath that. Daily Stochastic Relative Strength Index (Stoch RSI) near 16 is already inside oversold territory, which caps how far a first push can run before it pauses.
Bias: Bearish. Rallies into 99.00 and the 200-day EMA near 99.75 are for selling, objectives 98.50 then the 98.00 handle, invalidation on a daily close back above 99.75.
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.
- XAG/USD surges over 5%, reclaiming the $66.50 range top.
- Bullish RSI points higher, keeping buyers in near-term control.
- Break above $67 exposes the 100-day SMA and $71.88.
Silver (XAG/USD) price reversed course on Wednesday and soared over 5% as US Treasury yields edged lower, following the US Treasury stepping in to cap long-end US bond yields, which had reached levels last seen in 2007. At the time of writing, the XAG/USD pair trades at $66.68 after bouncing off daily lows of $62.19.
XAG/USD Price Forecast: Technical Outlook
In the short term, the trend is upward, but it has entered a phase of consolidation between $62.00 and $66.50. If buyers reclaim the top of the range, this clears the path to challenge higher prices.
Momentum remains bullish, as indicated by the Relative Strength Index (RSI), with the index aiming higher toward overbought territory. Hence, Silver’s path of least resistance is upside.
XAG/USD's first resistance is the day's high at $66.74, ahead of $67.00. Above is the 100-day Simple Moving Average (SMA) at 68.57, followed by the 200-day SMA at $71.88
XAG/USD Price Chart – Daily
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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