Forex News
ABN AMRO's Senior Economist Arjen van Dijkhuizen reviews China’s macro outlook after the Iran conflict, noting stronger early‑2026 data but slightly lower GDP forecasts. The bank now projects China’s 2026 growth at 4.6% and 2027 at 4.5%, while raising CPI forecasts for 2026 and 2027 as higher energy prices push inflation temporarily higher and delay further monetary easing.
Stronger data but conflict-driven headwinds
"China’s economy started the year on a strong footing (also see our recent China Macro Watch, On Iran, Trump-Xi, NPC and bullish data). The biggest improvement came from fixed investment, which turned back to growth in January/ February (+1,8% y/y) compared to a contraction of -3.8% in 2025. This turnaround was led by infrastructure spending, driven by local government bond issuance, but also by faster manufacturing investment and an easing slump in property investment."
"As the world’s largest energy importer and the key destination of energy shipments crossing the Strait of Hormuz, China is impacted by the Iran conflict. We still think there are various cushioning factors (e.g. high oil buffers, access to Russian energy) that will mitigate the impact. However, downside risks have risen due to the conflict, taking into account direct effects, and also indirect ones such as the hit to global demand."
"All in all, we tweaked our quarterly GDP growth profile somewhat (stronger Q1, weaker Q2), and as a result slightly cut our annual growth forecast for 2026, to 4.6% (from 4.7%) – within the government’s target zone of ‘between 4.5% and 5%’, as announced earlier this month. We slightly raised our 2027 growth forecast to 4.5%, from 4.4%."
"Despite ongoing domestic excess supply, the spike in energy prices will lead to higher (cost-push) inflation in the coming months, even though the impact is cushioned. Before the conflict erupted, CPI inflation rose to a two-year high of 1.3% y/y in February, driven by LNY spending, food prices and base effects. Core inflation jumped to a seven-year high of 1.8% y/y, while annual producer price deflation eased further."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Banco de Mexico, known as Banxico, unexpectedly cut the country’s main interest rate from 7% to 6.75% on Thursday on a 3-2 vote, with Deputy Governors Jonathan Heath and Galia Borja voting to keep interest rates unchanged.
Despite easing monetary policy, the Mexican central bank sees inflation risks trending to the upside. The governing council expects inflation to converge to the 3% plus or minus 1% target in Q2 of 2027, and “will evaluate additional reference rate adjustments.”
Banxico added that the current stance of monetary policy “is adequate to face the challenges posed by an extension and escalation of the Middle Eastern conflict.”
Banxico’s inflation projection
The board projects that headline inflation in 2026 will end at 3.5%, unchanged from the previous forecast. Underlying inflation is projected to hit 3.4% towards the end of the year and towards the end of 2027, both readings are projected to hit Banxico’s 3% goal.
Banxico FAQs
The Bank of Mexico, also known as Banxico, is the country’s central bank. Its mission is to preserve the value of Mexico’s currency, the Mexican Peso (MXN), and to set the monetary policy. To this end, its main objective is to maintain low and stable inflation within target levels – at or close to its target of 3%, the midpoint in a tolerance band of between 2% and 4%.
The main tool of the Banxico to guide monetary policy is by setting interest rates. When inflation is above target, the bank will attempt to tame it by raising rates, making it more expensive for households and businesses to borrow money and thus cooling the economy. Higher interest rates are generally positive for the Mexican Peso (MXN) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken MXN. The rate differential with the USD, or how the Banxico is expected to set interest rates compared with the US Federal Reserve (Fed), is a key factor.
Banxico meets eight times a year, and its monetary policy is greatly influenced by decisions of the US Federal Reserve (Fed). Therefore, the central bank’s decision-making committee usually gathers a week after the Fed. In doing so, Banxico reacts and sometimes anticipates monetary policy measures set by the Federal Reserve. For example, after the Covid-19 pandemic, before the Fed raised rates, Banxico did it first in an attempt to diminish the chances of a substantial depreciation of the Mexican Peso (MXN) and to prevent capital outflows that could destabilize the country.
- The US Dollar Index pushed toward the 100.00 psychological level as Tehran rejects Washington's ceasefire plan and the Strait of Hormuz remains closed.
- Iran rejected the US 15-point peace proposal earlier this week, issuing five counter-demands, including war reparations and sovereignty over the Strait of Hormuz.
- The Fed held rates at 3.50% to 3.75% last week, with one cut still projected for 2026; weekly Initial Jobless Claims edged up to 210K on Thursday, in line with consensus.
The US Dollar Index (DXY) rallied about 0.30% on Thursday, climbing from a session low around 99.56 to trade close to 99.90 as the Greenback continued to attract safe-haven interest for a third consecutive trading day.
The DXY has recovered more than three full points from its February low near 96.00, grinding steadily higher over the past five weeks. Thursday's push brought the index within touching distance of 100.00 for the first time since the pullback from mid-March highs near 101.00.
Iran's formal rejection of Washington's 15-point ceasefire proposal on Tuesday further hardened risk-off sentiment. Tehran issued its own list of five counter-demands, including war reparation payments and recognition of Iranian sovereignty over the Strait of Hormuz. The Strait remains effectively closed to Western-allied vessels, and shipping analysts see little prospect of routine commercial transit resuming before year-end.
Asian economies are bracing for worst-case energy scenarios: Japan began releasing 30 days of state oil reserves on Thursday, while the Philippines declared a national emergency over energy supply. On Thursday, President Trump said he was unsure whether he would hold Iran to a Friday deadline to reopen the Strait, and suggested taking over Iran's Crude Oil supply remains "an option."
The Federal Reserve (Fed) held the federal funds rate at 3.50% to 3.75% at its March meeting, with the updated dot plot still signaling one cut this year. Chair Jerome Powell acknowledged the conflict amounts to "an energy shock of some size and duration" but said it was too soon to judge the full impact on the US economy. Fed Governor Michael Barr echoed the cautious tone earlier this week, noting rates may need to stay elevated for some time to address inflation. Markets have largely priced out rate cuts for the near term, reinforcing the Dollar's yield advantage over the Euro and the Yen.
US Dollar Index 5-minute chart
Technical Analysis
In the 5-minute chart, Dollar Index Spot trades at 99.92. The near-term bias is mildly bullish as price holds comfortably above the rising 200-period EMA around 99.76, signalling an intact short-term uptrend despite the latest consolidation. Stochastic RSI is rolling lower from overbought territory, indicating waning upside momentum but not yet a decisive reversal while the oscillator remains above extreme oversold levels.
Initial support emerges at 99.90, guarding a deeper pullback toward the 200-period EMA near 99.76. A break below this area would expose the 99.70 region as next downside support. On the topside, immediate resistance stands at the recent intraday highs near 99.96, followed by the psychological 100.00 level, where fresh buying would be needed to extend the advance.
In the daily chart, Dollar Index Spot trades at 99.93. The near-term tone is mildly bullish as price holds above both the 50-day and 200-day exponential moving averages, which continue to edge higher and reinforce an underlying uptrend. However, the loss of momentum signaled by the Stochastic RSI rolling down from overbought toward the lower half of its range warns that upside traction is fading and that the index is vulnerable to a corrective pause rather than an immediate extension higher.
Initial support emerges at the 99.50–99.00 band, where recent lows converge with the rising 200-day average near 99.10, and a break below this area would expose deeper downside toward 98.50. On the topside, immediate resistance stands at the recent high near 100.50, followed by the 101.00 region if buyers regain control. As long as the index holds above the 99.00 area, the broader bias stays tilted to the upside, but a daily close below that support would shift focus toward a more neutral to bearish profile.
(The technical analysis of this story was written with the help of an AI tool.)
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.
Commerzbank economists Dr. Henry Hao and Moses Lim note USD/PHP rose to 60.10 after President Marcos declared a national state of emergency to tackle surging energy prices. The move expands powers to secure fuel and cap costs, while intervention risk has eased as authorities deem FX reserve defence "futile." The Philippine Peso (PHP) is down 2.1% versus the Dollar so far in 2026.
State of emergency shifts FX dynamics
"President Ferdinand Marcos Jr. declared a national state of emergency yesterday due to surging energy prices. This expands executive powers to secure fuel supplies and fast track policies aimed at shielding consumers and businesses from higher energy costs. "
"A state of national emergency was last declared in 2020 during the COVID-19 pandemic. President Marcos said the order was a “precautionary tool” to provide flexibility against global commodity price shocks. The state of emergency will last one year unless extended or suspended by the President."
"Under this state of emergency, a committee will be formed to directly procure energy commodities, food, medicine, and other necessities. The Department of Energy has also been ordered to tighten its oversight on energy prices and crackdown on profiteering."
"Additionally, the Department of Transport will subsidise fuel and commuter fares, suspend aviation taxes, and extend the operating hours for public transportation. The government has also temporarily mandated a four-day work week to curb energy use."
"USD-PHP rose 0.3% to 60.10 yesterday. The pair had initially fallen at market open but closed higher on the declaration of the state of emergency. Intervention risk has fallen as President Marcos said it would be "futile" to spend FX reserves to aggressively defend PHP. Year-to-date, PHP is down 2.1% vs the USD."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Here is what you need to know for Friday, March 27:
The US Dollar Index (DXY) surged to near 99.90, holding steady as safe-haven demand amid Middle East tensions and rate differentials underpinned the Greenback amid a cautious market mood. During a recent public appearance with Cabinet members, United States (US) President Donald Trump noted that the recent increase in Oil prices and the drop in the stock market amid tensions with Iran were not as severe as he had expected. He expressed confidence in the war effort and asserted that any economic damage would eventually be reversed.
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 | 0.23% | 0.30% | 0.18% | 0.27% | 0.83% | 0.80% | 0.40% | |
| EUR | -0.23% | 0.08% | -0.09% | 0.04% | 0.60% | 0.57% | 0.17% | |
| GBP | -0.30% | -0.08% | -0.15% | -0.03% | 0.54% | 0.50% | 0.10% | |
| JPY | -0.18% | 0.09% | 0.15% | 0.09% | 0.66% | 0.61% | 0.23% | |
| CAD | -0.27% | -0.04% | 0.03% | -0.09% | 0.57% | 0.53% | 0.14% | |
| AUD | -0.83% | -0.60% | -0.54% | -0.66% | -0.57% | -0.04% | -0.41% | |
| NZD | -0.80% | -0.57% | -0.50% | -0.61% | -0.53% | 0.04% | -0.39% | |
| CHF | -0.40% | -0.17% | -0.10% | -0.23% | -0.14% | 0.41% | 0.39% |
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).
EUR/USD slipped toward the 1.1530 area, pressured by a stronger US Dollar (USD) and lingering concerns over Eurozone growth following weak PMI data, keeping the pair on the defensive.
GBP/USD fell to the 1.3320 zone, struggling to recover amid USD strength and concerns about United Kingdom (UK) economic growth, which limited upside momentum.
USD/JPY rose to the 159.80 region, supported by elevated US Treasury yields and policy divergence. However, geopolitical tensions provided intermittent support to the Yen, preventing a sharper rally.
AUD/USD moved lower toward a two-month low near 0.6890, weighed down by risk aversion and a firm USD, with global growth concerns capping recovery attempts.
West Texas Intermediate (WTI) Oil trades near $94.30 per barrel, holding firm despite earlier easing, as Iran-related uncertainty kept a geopolitical risk premium in prices.
Gold declined toward the $4,380 region, failing to benefit from safe-haven demand amid a stronger USD.
What’s next in the docket:
Friday, March 27:
- UK March Consumer Confidence.
- UK February Retail Sales.
- Eurozone March Harmonized Index of Consumer Prices Prel.
- US March Michigan Consumer Sentiment & Inflation Expectations.
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.
- EUR/USD extends losses as US-Iran tensions keep the Dollar broadly supported.
- Markets now expect the Federal Reserve to hold rates through 2026 amid persistent inflation risks.
- The European Central Bank faces pressure as higher energy costs threaten Eurozone growth.
The Euro (EUR) edges lower against the US Dollar (USD) on Thursday, with EUR/USD extending losses for a third consecutive day as ongoing geopolitical tensions surrounding the US-Israel war with Iran keep the Greenback firmly bid across the board. At the time of writing, the pair trades near 1.1529, down around 0.26% on the day.
The war is expected to drag on after Iran rejected a proposed 15-point plan from the United States aimed at ending the conflict, saying any agreement must be on its own terms, including security guarantees and recognition of its authority over the Strait of Hormuz.
The Strait of Hormuz remains effectively closed, with the conflict continuing to embed a geopolitical risk premium in Oil prices. This is fueling global inflation concerns and could prompt major central banks to keep interest rates higher for longer or even consider raising rates if Oil prices remain elevated.
Markets now expect the Federal Reserve (Fed) to keep interest rates on hold through 2026, with the central bank already navigating a difficult policy backdrop. Inflation remains above the 2% target, with renewed upside risks, while labor market risks are tilted to the downside, putting both sides of the Fed’s dual mandate under pressure.
In this environment, the Fed is likely to remain data-dependent, keeping policy restrictive for longer to contain inflation while closely monitoring signs of weakness in the labor market before considering any adjustments.
The European Central Bank (ECB) is also in a difficult position. While inflation is relatively contained near the 2% target, the Eurozone’s reliance on energy imports makes it more exposed to higher Oil prices, which are expected to weigh on growth and household spending.
Market pricing has shifted sharply, with two rate hikes now fully priced in versus earlier expectations of a hold, and April increasingly seen as the likely timing for the first rate hike.
Supporting this view, ECB policymaker Joachim Nagel said, “An April rate hike is certainly an option, but just one option,” adding, “We will have enough data by April to determine if we need to act or if we can wait and see.”
On the data front, recent economic releases this week have pointed to a slowdown in the Eurozone economy. Germany’s GfK Consumer Confidence for April fell to -28, missing expectations, while the Ifo Business Climate index dropped to a 13-month low of 86.4 in March.
Recent Purchasing Managers Index (PMI) data also showed business activity losing momentum, reinforcing concerns about weaker growth.
Inflation FAQs
Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%.
The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls.
Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money.
Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
- Gold falls below $4,400 as Oil climbs and inflation fears boost the US Dollar.
- Markets now price Fed tightening, with US 10-year yields rising to 4.41%.
- Uncertainty over US-Iran talks and war risks keeps pressure on bullion prices.
Gold (XAU/USD) price plummets nearly 2.50% on Thursday as Oil prices rise amid uncertainty about a possible agreement between the US and Iran, adding upward pressure on inflation and pushing the Greenback higher. At the time of writing, XAU/USD trades at $4,394 after reaching a daily high of $4,544.
Bullion drops as rising energy prices and hawkish Fed repricing weigh on demand
Financial market sentiment remains dismal. US President Donald Trump warned Iran to get serious about agreeing to a deal. He said that Iranian negotiators are “very different” and “strange,” adding that, privately, they're begging for a deal, while publicly they say they’re looking at the proposal.
Iran is reviewing the US 15-point proposal aimed at ending hostilities, though it hinted that it is not open to talks.
Some of Washington’s demands include the removal of Iran’s stocks of highly enriched uranium, curbing its ballistic missile program and cutting funding for regional allies.
In the meantime, the Pentagon is getting ready to deploy ground forces to Iran, providing further options to President Trump. According to Axios, the US Pentagon is preparing for a “final blow” against Iran, which would include the use of ground forces.
Another reason for Gold’s plunge is that Bloomberg reported that Turkey’s central bank sold and swapped about 60 tons of Gold, “worth more than $8 billion, in two weeks after the start of the war in Iran, adding to downward pressure on bullion prices.”
Markets priced in a hawkish Fed
Aside from this, money markets are pricing in a high inflation scenario. At the beginning of the year, traders expected at least two rate cuts from the Federal Reserve (Fed). However, since the conflict began and following the Fed’s policy decision on March 18, they trimmed their dovish bets. Instead, they’re expecting 12 basis points of tightening by the US central bank, according to Prime Market Terminal.
Consequently, US Treasury bond yields have risen, making Gold’s status as a haven less appealing. The US 10-year Treasury note is up eight basis points at 4.412%.
The US economic docket showed solid jobs data from the US Department of Labor. Initial Jobless Claims for the week ending March 21 came at 210K, as expected by analysts, up from the previous print of 205K.
Ahead, eyes are on speeches by a handful of Federal Reserve officials, led by Governors Lisa Cook, Stephen Miran, Philip Jefferson and Michael Barr. Along with them, Dallas Fed President Lorie Logan will cross the wires.
XAU/USD technical outlook: Gold’s downtrend resumes below $4,400
Gold price is reversing course after failing to reclaim $4,550, which exacerbated the ongoing drop below $4,400. A day ago, XAU/USD clashed with the 100-day Simple Moving Average (SMA) at $4,600, and failure to reclaim that level opened the door for further downside.
The Relative Strength Index (RSI) is trending lower, edging further deep towards oversold territory, an indication that sellers are gaining momentum.
Should Gold close daily below $4,400, the next support would be the Tuesday daily low at $4,306, followed by the Monday swing low at $4,098.
On the upside, bulls must clear the Wednesday daily low at $4,456 to reclaim $4,500.
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.
MUFG’s Senior Currency Analyst Lloyd Chan maintains a defensive stance on Asia FX as the US‑Iran conflict keeps external pressures elevated. Higher US yields and Oil prices are supporting the Dollar and weighing on Asian currencies such as THB, PHP and KRW. The bank argues that only credible geopolitical de‑escalation and lower Oil or US yields can restore broader Asia FX stability, with CNY resilience providing some regional anchor.
Asia currencies pressured by external shocks
"We maintain a defensive stance on Asia FX amid ongoing uncertainty surrounding the US-Iran conflict. In the absence of credible de‑escalation and normalization of energy flows through the Straits of Hormuz, elevated oil prices and higher US yields are likely to keep the USD supported, while oil‑importing Asian currencies remain vulnerable."
"For Asia FX, external pressures are still dominant. Higher US yields and elevated energy prices have pushed several Asian currencies to fresh lows versus the USD since the conflict began. THB (‑4.8%), PHP (‑4.1%), and KRW (‑4.1%) have been among the weakest performers, reflecting sensitivity to oil prices and risk sentiment."
"Inflation risks across Asia remain asymmetric to the upside, driven by energy prices and the risk of second‑round pass‑through into transportation and food costs. This is particularly relevant given high food CPI weights in regional economies such as Thailand, India, Vietnam, and Philippines (>30% weight)."
"Any credible signs of de‑escalation, such as a reopening of Hormuz or a clearer pathway toward ending the conflict, would be a key catalyst for reassessment. For now, resilience in CNY remains a notable anchor for the region."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Alan Taylor, an external member of the Monetary Policy Committee of the Bank of England (BoE), said that he currently sees a high bar to hiking the rates at a conference in New York hosted by Exante Data. He also added that the current energy shock looks more like the 2011 situation than the 2022.
Key takeaways:
The current energy shock looks more like 2011 than 2022 in magnitude.
Currently see a high bar to hiking.
Holding policy steady preferable until impact of energy shock becomes clearer.
UK faces low risks of inflation becoming unanchored given weakening labour market and slowing wage growth.
If disruptions persist and shock grows, MPC will face tougher choice between high inflation and weaker growth.
If shock mild or short-lived, could allow for more rate cuts once risks diminish.”
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 Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.22% | 0.20% | 0.14% | 0.30% | 0.72% | 0.71% | 0.36% | |
| EUR | -0.22% | -0.02% | -0.11% | 0.08% | 0.51% | 0.50% | 0.15% | |
| GBP | -0.20% | 0.02% | -0.06% | 0.10% | 0.53% | 0.51% | 0.17% | |
| JPY | -0.14% | 0.11% | 0.06% | 0.15% | 0.58% | 0.55% | 0.22% | |
| CAD | -0.30% | -0.08% | -0.10% | -0.15% | 0.43% | 0.41% | 0.07% | |
| AUD | -0.72% | -0.51% | -0.53% | -0.58% | -0.43% | -0.02% | -0.34% | |
| NZD | -0.71% | -0.50% | -0.51% | -0.55% | -0.41% | 0.02% | -0.34% | |
| CHF | -0.36% | -0.15% | -0.17% | -0.22% | -0.07% | 0.34% | 0.34% |
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).
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