Forex News

• USD/JPY edges higher to around 159.30 in Friday’s early European session. 
• Traders will closely monitor the US CPI inflation report on Friday ahead of US-Iran talks. 
• Japan plans to release 20-days worth of oil stock from early May onwards. 

The USD/JPY pair attracts some buyers to near 159.30 during the early European trading hours on Friday. A fragile ceasefire between the US and Iran provides some support to the US Dollar (USD) against the Japanese Yen (JPY). 

Traders await the crucial US Consumer Price Inflation (CPI) report later on Friday, which could provide direction for the Federal Reserve's  (Fed) higher-for-longer interest rate stance. Market consensus expects to see headline CPI inflation rise to 3.3% YoY in March from 2.4% in February, driven by soaring oil prices due to the Middle East war. 

Meanwhile, the core CPI is projected to show a rise of 2.7% in March, versus 2.5% prior. Any signs of hotter inflation in the US could underpin the Greenback against the JPY in the near term. 

US President Donald Trump said on Thursday that he expects Iran to comply with terms he says were agreed on for a ceasefire ahead of planned negotiations this weekend, warning that if it doesn't, he'll order large-scale attacks on the country. 

The outcome of make-or-break talks between the US and Iran on Saturday in Pakistan will be closely watched. The US delegation will be led by US Vice President JD Vance, special envoy Steve Witkoff, and Jared Kushner. 

Japanese Prime Minister Sanae Takaichi stated on Friday that the government is weighing a plan to release approximately 20 days' worth of additional oil reserves starting from early May onwards. This move aims to stabilize domestic energy supplies amid persistent shipping disruptions in the Strait of Hormuz. 

Here is what you need to know on Friday, April 10:

Markets take a breather early Friday and major currency pairs' fluctuations remain contained as investors' focus shifts to the March Consumer Price Index (CPI) data from the United States (US). The economic calendar will also feature Canada employment data for March and the University of Michigan (UoM) will publish the preliminary Consumer Sentiment Index data for April.

Following Wednesday's risk rally, markets adopted a cautious tone on Thursday with investors doubting the sustainability of the ceasefire agreement between the US and Iran. Nonetheless, the US Dollar (USD) Index registered small daily losses and Wall Street's main indexes gained between 0.5% and 0.7%. After suffering heavy losses midweek, crude Oil prices edged higher and the barrel of West Texas Intermediate rose about 1% on the day before stabilizing near $92.00.

Israeli Prime Minister Benjamin Netanyahu announced Thursday that he has ordered the start of direct negotiations with Lebanon "as soon as possible," with talks expected to center on disarming Hezbollah and establishing a formal peace between the two nations. However, Netanyahu later clarified that there is "no ceasefire in Lebanon" and that they will continue to strike Hezbollah with full force. Meanwhile, US President Donald Trump said that Iran was doing a "very poor job" of allowing Oil to go through the Strait of Hormuz. Early Friday, US Stock index futures trade marginally lower and USD Index clings to gains near 99.00. In the US, the CPI is forecast to rise 3.3% on a yearly basis in March, up sharply from 2.4% in February.

Gold (XAU/USD) rose about 1% on Thursday but lost its recovery momentum early Friday. At the time of press, XAU/USD was trading in a tight channel at around $4,750.

EUR/USD posted gains for the fourth consecutive day on Thursday before entering a consolidation phase at around 1.1700 on Friday.

USD/CAD recovers slightly and trades at around 1.3830 after touching its weakest level in two weeks near near 1.3800 on Thursday. In Canada, the Unemployment Rate is forecast to edge higher to 6.8% from 6.7% in February.

GBP/USD retreats in the European morning on Friday but holds above 1.3400 following a four-day climb.

USD/JPY closed in positive territory on Thursday and continued to edge higher in the Asian session on Friday. As of writing, the pair was up 0.2% on the day near 159.30. Bank of Japan (BoJ) Deputy Governor Ryozo Himino said that the Japanese economy is not in stagflation and explained that a prolonged conflict in the Middle East could push down growth and accelerate inflation.

DBS Group Research economist Eugene Leow notes that Gold has been consolidating in a tight range despite sharp moves in energy markets, as traders await key US CPI data. The report highlights stronger institutional demand, with rising ETF holdings after late-March weakness. Geopolitical risks in the Middle East and upcoming US data remain key drivers for Gold.

Institutional demand and geopolitical risk

"Gold prices consolidated in a narrow range overnight, exhibiting muted price action despite heightened volatility in energy markets."

"Doubts over the durability of the Middle East ceasefire, underscored by the continued blockage of commercial shipping through the Strait of Hormuz, pushed oil prices toward the $100 threshold."

"Yet, real yields remained largely unchanged, decoupling from energy market turbulence as investors retreated to the sidelines ahead of today’s pivotal US CPI release."

"Institutional appetite for gold has strengthened noticeably over the past week."

"ETF holdings have been rising steadily as institutional investors systematically scale into positions, capitalising on late-March price weakness to establish strategic exposure. In the near term, attention will remain focused on the outcomes of upcoming discussions between the US and Iran and whether transit activity normalises in the coming days."

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

MUFG’s Senior Currency Analyst Lloyd Chan argues that Asia FX gains on ceasefire hopes are running ahead of fundamentals, as Oil retains a structural floor and US yields stay elevated. He highlights that tanker traffic through the Strait of Hormuz remains subdued and war-risk premia high, reinforcing US Dollar strength and suggesting Asia FX relief rallies are vulnerable to reversal.

Relief rally seen as fragile and temporary

"While the announcement of a two-week US–Iran ceasefire has provided short-term relief to Asia FX, the reprieve looks fragile. The ceasefire does not appear to cover Lebanon, and Israel’s subsequent strike on Lebanon has raised concerns about the durability of the ceasefire agreement. More tellingly, tanker traffic through the Strait of Hormuz remains subdued, and war-risk insurance premia are likely to stay elevated, even under a ceasefire."

"For Asia FX to move from a relief-driven bounce to more sustained recovery, several conditions would likely need to be met. First, there must be a reopening of the Strait of Hormuz, with tanker volumes normalizing. Second, oil prices would need to decline sustainably, reducing the inflation effect that is currently feeding into higher US yields and underpinning the US dollar."

"Third, the Fed would need to re-anchor toward policy easing. At this stage, none of these conditions have been sufficiently fulfilled. This argues for fading ceasefire-driven strength in Asia FX, particularly in oil-sensitive currencies such as INR, PHP, and THB."

"However, CNY strength continues to provide a stabilizing anchor for the region, underpinned by China’s sizeable strategic reserves, while Singapore’s deep energy infrastructure, diversified energy sourcing, and ample fiscal buffers could keep SGD relatively resilient below the 1.3100 level against USD."

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

• NZD/USD retraces to near 0.5845 as antipodeans face pressure ahead of US-Iran negotiations.
• Military attacks in Lebanon have raised concerns over the hopes of a US-Iran permanent ceasefire.
• This week, the RBNZ left its OCR unchanged at 2.25%.

The NZD/USD pair corrects after a four-day winning streak, trading 0.25% lower to near 0.5845 during the early European trading session on Friday. The Kiwi pair faces slight selling pressure as investors turn cautious ahead of negotiations between the United States (US) and Iran regarding the 10-point peace proposal, proposed by Tehran in consideration of a permanent ceasefire.

As of writing, S&P 500 futures trade subduedly around 6,825, after a two-day rally, reflecting a calm market mood. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.1% higher to near 98.90.

Meanwhile, continued military attacks between Israel and Iran-backed Houthis in Lebanon have raised concerns over hopes of a positive outcome from US-Iran talks in Pakistan over the weekend.

On the domestic front, the Reserve Bank of New Zealand (RBNZ) held its Official Cash Rate (OCR) steady at 2.25% on Wednesday, as expected, and guided that the monetary policy path would remain on the upside. RBNZ Governor Anna Breman said, “Tightening could be at every meeting or every other meeting, it depends,” and added, “Neutral rate is a range with a midpoint at 3.0%.”

In the US, investors await the US Consumer Price Index (CPI) data for March, which will be published at 12:30 GMT.

NZD/USD technical analysis

At press time, NZD/USD trades lower at around 0.5845. The daily chart shows a mildly bullish near-term bias, as spot trades above the 20-day Exponential Moving Average (EMA) at 0.5803, suggesting that recent dips would be supported rather than extended.

A quick shift by the 14-day Relative Strength Index (RSI) into the 40.00-60.00 zone from the area below 40.00, indicates the onset of a bullish reversal rather than just a pullback move.

On the downside, initial support is aligned with the 20-day EMA at 0.5803, where a daily close below would weaken the constructive tone and open the door to a deeper retracement toward the April 3 high of 0.5754. As long as buyers defend this moving average on pullbacks, the path of least resistance favors further recovery attempts toward the March 19 high at 0.5893. A decisive break above 0.5893 would open the door for further advancement towards the March 10 high of 0.5965.

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

• The Euro stands above 0.8700 against the Pound but is on track for a moderate weekly decline.
• The pair trades in range amid a frail market sentiment as Iran's ceasefire staggers.
• German inflation data endorses the view of an upcoming ECB rate hike.

The Euro (EUR) holds moderate gains against the British Pound (GBP) on Friday. The pair edges up above 0.8700 at the European session’s opening times, yet on track to a minor weekly decline, with both currencies trimming gains against the safe-haven US Dollar (USD) as Iran’s ceasefire staggers.

Tehran has threatened to pull out of the peace process after massive attacks from Israel killed more than 300 people in Lebanon. US President Donald Trump, on the other hand, has complained about Iran’s poor handling of the traffic in the Strait of Hormuz war4ning on Truth Social that "That is not the agreement we have".

Data released by the Hormuz Trail Monitor shows that only seven vessels have crossed the critical waterway in the last 24 hours. This is about a 5% of the 140 ships that would sail through the strait in an average day before the war, while Iranian authorities are reportedly charging fees for Oil tankers.

German Inflationary pressures soar in March

In the economic docket, the German Harmonized Index of Consumer Prices (HICP) confirmed preliminary figures showing that inflation accelerated 1.2% in March and 2.7% year on year, from 0.4% and 1.9% respectively, boosted by higher energy prices amid the war in the Middle East.

These figures fuel market expectations that the European Central Bank (ECB) will be forced to hike rates in the coming months, and maybe as soon as in April. The Bank of England (BoE), on the contrary, is taking a “wait and see " stance and is not expected to tighten its monetary policy anytime soon. This is providing some competitive advantage to the Euro.

Danske Research Team reports that global equities extended gains, led by US markets, with cyclical sectors outperforming while defensive and low-volatility names lag. The VIX has fallen back below 20, and Asian equities and European futures are trading higher, suggesting risk appetite remains resilient despite ongoing geopolitical tensions.

Cyclicals lead while defensives unwind

"Equities continued higher yesterday, led by the US, and the week is increasingly shaping up as a full reversal on the equity side. We have seen pronounced cyclical outperformance, while low-vol/defensive equities have been aggressively unwound."

"With VIX now back below 20, this should serve as a yet another reminder of how markets behave in periods characterised by elevated geopolitical noise, a still-solid macro backdrop, and late-cycle exuberance. In such environments, the behavioural component becomes critical highlighting the risk of 'running after the market' when breaking news hits the screen continuously."

"Despite the strong focus on Iran, an equally important theme is unfolding beneath the surface, both for equities and for broader asset allocation, including private equity and private credit. Namely, that 'tech is no longer just tech'. Software continues to lag meaningfully and yesterday was another clear example: software was the worst-performing segment, while semiconductors outperformed sharply, by ~4pp in the US and ~7pp in Europe on the day alone."

"Zooming out, this is a continuation of a trend we highlighted months ago in our "When tech disrupts tech" editorial. Over the past nine months, hardware has been the best-performing industry in the US, while software has been the worst, leaving hardware outperforming software by ~125 percentage point (!) over the period."

"This morning, Asian equities are trading higher, European futures are pointing up, while US futures are broadly flat."

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

Commerzbank’s Volkmar Baur argues that FX markets will increasingly shift focus from Gulf tensions to the impact of higher Oil prices on United States (US) inflation and the US Dollar (USD). He highlights a sharp March Consumer Price Index (CPI) boost from gasoline and warns that second‑round effects via trucking costs could lift consumer prices and shape Federal Reserve (Fed) policy under Kevin Warsh.

Oil-driven inflation and Dollar outlook

"Looking ahead, the fx markets will likely increasingly focus on the effects of the oil price shocks. And fittingly, important data is coming out today that could provide a first small glimpse: the US inflation figures for March."

"According to Bloomberg, the consensus expects a significant rise in the monthly rate to 0.9%, which would push the annual rate to 3.4% - its highest level in two years. The impact on the core rate, however, is understandably estimated to be significantly smaller. The consensus expects an increase of 0.3% here compared to the previous month."

"In the coming months, however, it will likely be more interesting to see how second-round effects play out. For even though there are hardly any diesel-powered cars in the US and the price of diesel is therefore irrelevant to consumer prices, trucks, on the other hand, run on diesel. And here, prices in the US actually rose by 32% last month."

"Most logistics companies have therefore already reacted and significantly raised their trucking rates. By the end of March, these rates were already more than 10% higher than at the end of February. And since all goods must eventually be transported from A to B, transportation costs will ultimately find their way into consumer prices as well."

"For the US Federal Reserve, however, this is likely to be a decisive factor in the coming months. And how its newly appointed chairman, Kevin Warsh, will handle this - despite his desire to lower interest rates - will then be decisive for the USD."

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

• Silver gains support as the US–Iran ceasefire drove oil prices lower, easing inflation and rate hike concerns.
• Silver’s upside may be capped as the US Dollar steadies amid renewed risk aversion.
• President Trump said US forces will remain deployed around Iran until full compliance with the agreement.

Silver price (XAG/USD) extends its winning streak, trading around $76.00 per troy ounce during the Asian hours on Friday. The non-interest-bearing Silver found support as the United States (US)–Iran ceasefire triggered a sharp drop in oil prices, easing concerns over renewed inflation and further rate hikes by the central banks.

The dollar-denominated metal also benefited from a subdued US Dollar (USD) earlier this week, making it cheaper for foreign buyers. However, gains may be limited as the Greenback steadied amid renewed risk aversion driven by ongoing uncertainty surrounding the US–Iran ceasefire longevity.

Market sentiment stays cautious as Israel continues strikes on Hezbollah, despite Benjamin Netanyahu stating that Israel will soon begin direct negotiations with Lebanon. Meanwhile, US President Donald Trump said US forces will remain deployed around Iran until full compliance with the agreement is achieved.

Traders turned their attention to expected diplomatic talks in Islamabad this weekend, where US Vice President JD Vance may lead the American delegation in meetings with Iranian officials. However, uncertainty persists, with no official confirmation of delegates’ arrival on Friday.

The Federal Reserve March Meeting Minutes indicate policymakers are maintaining a wait-and-see approach, while acknowledging that inflation risks linked to higher oil prices are becoming more balanced. Traders are awaiting the US Consumer Price Index (CPI) report due later in the North American session, a key catalyst for near-term Federal Reserve (Fed) policy direction.