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BNY’s Geoff Yu highlights that APAC balance-of-payments pressures from the Iran conflict and energy by-products are increasingly driving currency flows, with MYR, THB, AUD and PHP in focus. Core North Asian exporters appear more resilient thanks to reserves and savings, while Southeast Asia and Australia face fuel shortages and weaker terms of trade. Markets are expected to stay cautious on these currencies despite some positioning resilience.

Energy shock drives APAC currency caution

"Four weeks into the Iran conflict, markets are steadily appreciating the importance of the Gulf region in exporting energy by-products. From helium to urea, many of these inputs are essential to whole swathes of the APAC economy. While mineral fuels remain the biggest source of regional balance-of-payments stress, the global nature of the current supply shock will likely lead to a wider negative terms-of-trade shock, forcing governments to react accordingly."

"Core North Asian export-driven economies have sufficient energy resilience over the coming months. Crucially, their reserve coverage levels are high enough to withstand higher import costs over an extended period. High levels of precautionary savings and strong fiscal resources (ex-Japan) represent an additional buffer, to the extent that we don’t see strong FX or fixed income outflows as a major concern for now."

"The situation is different for the rest of APAC. Some of the most aggressive government responses along the lines of fuel rationing have been seen in Southeast Asia – President Marcos of the Philippines stated on Tuesday that he couldn’t even rule out planes being grounded due to the lack of jet fuel. Even Australia, despite being a crucial net exporter of natural gas, is facing shortages of refined petroleum, which is impeding a stronger terms-of-trade adjustment."

"Despite the clear challenges, the only regional currencies that were net sold over the past month are those whose starting position was overheld. Reducing exposures was therefore quite straightforward. MYR, THB and AUD, by contrast, were already significantly underheld, so the marginal benefit of adding to hedges for cross-border investors proved more limited."

"We expect markets to remain cautious on these currencies, but the swift change in behavior can help build resilience over time and reduce risk premia."

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

• USD/CHF rebounds from 100-day SMA, extending gains for a second day.
• RSI above 50 signals bullish momentum building toward overbought territory.
• Break above 0.8000 exposes YTD high and 0.8124 resistance.

The USD/CHF pair advances for the second consecutive day on Wednesday, up by nearly 0.45% after bouncing off the 100-day Simple Moving Average (SMA), slightly above the 0.7900 figure. At the time of writing, the pair trades at 0.7915 as the US Dollar (USD) remains boosted by geopolitical uncertainty.

USD/CHF Price Forecast: Technical outlook

Recently, USD/CHF has been trading sideways due to the lack of a clear catalyst amid the Middle East war. Still, over the last two days, buyers have been pressing towards clearing the 200-day Simple Moving Average (SMA) at 0.7946, a key resistance level on the buyers’ path towards 0.8000.

Momentum confirms that bulls are in charge, as the Relative Strength Index (RSI) is above its 50-neutral level and heading towards overbought territory.

With that said, USD/CHF needs to surpass the key resistance level at 0.7946. If buyers reclaim 0.8000, it opens the door to challenging the year-to-date (YTD) high of 0.8040. Once surpassed, the next stop would be the November 5 swing high at 0.8124.

USD/CHF Price Chart — Daily

DBS Group Research economist Radhika Rao discusses Indonesia’s onshore markets as they reopen after the Lebaran holiday to a backdrop of uncertain geopolitics and volatile global sentiment. She notes likely cautious trading in IDR assets, potential budget reallocations and efficiency measures, rising inflation pressures, and reduced prospects for further monetary easing in Indonesia this year.

IDR assets face cautious post-holiday reopening

"Indonesia’s onshore markets are set to reopen following the long Lebaran break, with investors confronting a still uncertain geopolitical environment."

"Global markets have swung between hope and despair amidst signs of a brief respite in hostilities, which is quickly followed by conflicting statements by the key actors."

"Local authorities are reportedly mulling over risk mitigation steps in the face of an increase in energy costs and supply shortages, including work-from-home work policy, seek to curb non-essential use of vehicles/ transport and hybrid school sessions to conserve fuel usage, according to the local press reports."

"Risks to price stability and heightened financial market volatility are likely to dampen expectations for additional monetary easing this year."

(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 Thursday, March 26:

Markets were driven by a shift in geopolitical sentiment as reports of potential ceasefire talks initially eased tensions. However, uncertainty quickly resurfaced after Iran signaled reluctance to engage with the United States, highlighting fragile diplomatic progress and keeping markets on edge.

The US Dollar Index (DXY) climbed just below the 100 mark, trading near 99.50, as the Greenback remained supported by rate differentials and safe-haven demand earlier in the week. Amid a deteriorating market mood, the USD held firm.

EUR/USD fell to near the 1.1570 region, slightly softer on the day as the stronger US Dollar (USD) capped the Euro’s (EUR) upside. The pair remained under pressure following weak Eurozone PMI data on Tuesday, with growth concerns continuing to weigh on the Euro.

GBP/USD slipped toward the 1.3370 zone, with the Pound struggling to regain terrain amid ongoing concerns about the United Kingdom (UK) growth and inflation dynamics.

USD/JPY surged to the 159.30 area, supported by elevated US yields and continued policy divergence between the Federal Reserve (Fed) and the Bank of Japan (BoJ).

AUD/USD fell to the 0.6960 range, the stronger USD amid risk and global growth, which in turn capped gains in the Aussie.

West Texas Intermediate (WTI) Oil had a slight surge near the $90.30 per barrel, easing from recent highs amid hopes of a ceasefire, which reduced immediate supply fears. However, prices remained elevated, reflecting ongoing geopolitical uncertainty.

Gold surged toward the $4,550 region, benefiting from falling yields and easing oil-driven inflation fears, while still drawing support from lingering geopolitical uncertainty.

What’s next in the docket:

Thursday, March 26:

• Germany GfK Consumer Confidence (Apr).
• Eurozone Gross Domestic Product (Q4).
• Germany Bundesbank Monthly Report.
• United States Initial Jobless Claims.
• New Zealand ANZ – Roy Morgan Consumer Confidence (Mar).

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.

• Gold rises above $4,500 as hopes for US-Iran talks improve market sentiment.
• Falling US yields offset a firmer Dollar, helping bullion recover from recent losses.
• Markets still price a hawkish Fed stance as inflation and energy risks remain elevated.

Gold price (XAU/USD) gains nearly 2% on Wednesday as Oil futures prices tumbled amid growing speculation that the US and Iran would begin talks to end the conflict that started nearly four weeks ago. At the time of writing, XAU/USD trades at $4,556.

Bullion rebounds as easing war fears drag Crude lower; US Treasury yields tumble

The US sent Iran a 15-point proposal that could end the war that began nearly four weeks ago. If Tehran agrees to resume talks with Washington, they could begin as early as Thursday and be held in either Pakistan or Turkey.

After the headline, risk appetite improved; Oil sank, and bullion capped its losses.

In the meantime, the Greenback continues to appreciate, as reflected in the US Dollar Index (DXY). The DXY, which tracks the US Dollar performance against a basket of six currencies, is up nearly 0.40% to 99.55.

Recently, Iranian media reported that the regime has rejected the US proposal, but sources said the Iranians will get back to them later on Wednesday.

The Wall Street Journal reported that "Iran is being less strident in private discussions to end the war than it is in public, Arab mediators and other people familiar with the matter said, giving them hope the diplomatic effort they are trying to spark isn't dead on arrival."

The decline in US Treasury bond yields drives bullion's advance during the day. The US 10-year Treasury note falls four basis points to 4.328%, a tailwind for the non-yielding metal.

A weak US Treasury auction on Tuesday of two-year Treasury notes drew unexpectedly weak demand, sending the US 2-year T-note yield up towards 3.936% amid investor speculation that inflation would rise sharply.

US import prices rose the most in four years in February, driven by surging energy costs before the Middle East conflict, an indication that the battle against inflation has not yet been won. Prices rose 1.3%, the largest increase since March 2022, exceeding forecasts for a 0.5% jump, following January's 0.2% increase.

On Tuesday, S&P Global revealed that US businesses paid more for inputs in March, due to surging energy costs and supply chain disruptions.

Money markets had priced out rate cuts by the Federal Reserve in 2026; instead, traders are pricing in 4 basis points of tightening, according to Prime Market Terminal.

On Thursday, the US economic docket will feature Initial Jobless Claims for the week ending March 21, along with speeches by the Fed's Cook, Miran, Jefferson, Logan, and Barr.

XAU/USD technical outlook: To remain range-bound, trapped within the 100- and 200-day SMAs

Gold price seems to have bottomed during the week after almost testing key support at the 200-day Simple Moving Average (SMA) around $4,083, which exacerbated a recovery towards the Tuesday high of $4,484 ahead of the $4,500 mark.

The Relative Strength Index (RSI), although rising, suggests the yellow metal is bearishly biased, but in the short term seems poised to remain trading sideways.

If Gold clears the 100-day SMA around $4,592, the next target is $4,600. A breach of the latter will expose the 50-day SMA at $4,961.

Conversely, if XAU/USD struggles to remain afloat of $4,500, bears could push prices towards the March 24 daily low of $4,305 ahead of the March 23 swing low of $4,098.

• USD/JPY posts consecutive gains after bouncing from 20-day SMA support.
• RSI signals bullish momentum, pointing toward a retest of weekly highs.
• Failure to clear 159.65 keeps focus on downside support levels.

USD/JPY registers back-to-back bullish days on Wednesday after testing key support at the 20-day Simple Moving Average (SMA) around 158.24 on Monday, yet it remains shy of clearing the key weekly high of 159.65 hit on Monday. At the time of writing, the pair trades at 159.27, up 0.36%.

USD/JPY Price Forecast: Technical Outlook

The technical picture suggests that the USD/JPY pair might retest weekly highs in the short term. Momentum, as measured by the Relative Strength Index (RSI), confirms the latter. Still, fears of Japanese authorities intervening in the FX markets could prevent USD bulls from pushing the pair towards the 160.00 milestone.

On the downside, the first area of interest is the 20-day SMA at 158.24. Once surpassed, it opens the door to challenging the March 19 daily low of 157.51, as the 50-day SMA emerges as the next key line of defense for bulls at around 156.56.

On further weakness, the next support would be the 100-day SMA at 156.26, ahead of 156.00.

USD/JPY Price Chart — Daily

Societe Generale’s Kunal Kundu argues that India’s new GDP series points to weaker historical growth and softer domestic demand than previously reported. The revision suggests earlier real GDP and consumption were significantly overstated, aligning better with high-frequency indicators and labour market surveys. The analysis highlights structural constraints, household balance-sheet stress and limited benefits from the September 2025 GST rate cut for overall demand.

New data expose overstated Indian growth

"The revised data indicate that real GDP growth was over‑stated by ~2 percentage points, an unheard‑of magnitude for a national account’s revision."

"India’s newly launched GDP series indicated a lower activity level and more modest earlier growth."

"We have for long been arguing that cyclical recovery of the economy from the pandemic low has hit a barrier imposed by the structural limits to growth."

"The new series revealed an unprecedented trend of negative manufacturing sector deflator for the intervening periods (especially during the period when inflation was raging), underscoring persistently weak domestic demand conditions."

"Unsurprisingly, the data now shows that the old series consistently overestimated domestic demand."

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

• NZD/USD posts a second consecutive daily decline, approaching the 0.5800 area.
• The US Dollar remains supported by expectations of a restrictive monetary policy.
• Ongoing uncertainty around the Middle East conflict boosts safe-haven demand.

NZD/USD trades lower on Wednesday around 0.5820, down 0.22% on the day, extending its decline for a second straight day. The downside move is mainly driven by the strength of the US Dollar (USD), supported by a broader risk-off environment.

Geopolitical tensions in the Middle East continue to underpin demand for safe-haven assets, despite intermittent hopes of de-escalation. Negotiations between the United States (US) and Iran remain uncertain, and recent developments suggest that a swift agreement is unlikely, keeping a risk premium embedded in markets.

At the same time, expectations of a hawkish stance from the Federal Reserve (Fed) continue to support the Greenback. Persistent inflation concerns, partly fueled by elevated energy prices amid geopolitical tensions, are prompting investors to reassess the path of US interest rates to the upside.

In New Zealand, the economic outlook remains fragile. Reserve Bank of New Zealand (RBNZ) Chief Economist Paul Conway noted that spare capacity in the economy will shape how the central bank responds to inflationary pressures stemming from higher Oil prices. This cautious stance limits support for the New Zealand Dollar (NZD).

Additionally, Fitch Ratings recently revised New Zealand’s sovereign outlook to negative, citing economic risks linked to the Middle East conflict and the country’s reliance on energy imports. This downgrade adds further pressure on the NZD and keeps NZD/USD biased to the downside in the near term.

• USD/CAD extends gains toward 1.3800 as broad US Dollar strength keeps the Loonie under pressure.
• Geopolitical tensions and Iran’s rejection of a US ceasefire plan sustain safe-haven demand for the Greenback.
• Technical breakout above key resistance zone strengthens bullish momentum, with indicators pointing to further upside.

USD/CAD edges higher on Wednesday, extending gains for a third straight session as a broadly stronger US Dollar (USD) keeps the Canadian Dollar (CAD) under sustained pressure.

At the time of writing, the pair is trading around 1.3806, its highest level since January 22.

The Greenback continues to draw support from escalating Middle East tensions. In the latest developments, Iran has rejected a US-backed ceasefire proposal and poured cold water on Washington’s 15-point plan, saying any deal would be on its own terms.

At the same time, Oil prices remain volatile, holding above pre-conflict levels despite a recent pullback. Given Canada’s status as a major crude exporter, elevated Oil prices typically support the commodity-linked Loonie. However, the broader strength in the USD and persistent risk aversion are currently outweighing that support, keeping USD/CAD biased to the upside.

USD/CAD technical analysis

From a technical perspective, USD/CAD is showing strengthening momentum after breaking above the 50-day Simple Moving Average (SMA) at 1.3680 and clearing the 1.3700-1.3750 resistance zone, which had capped upside attempts since early February.

The latest leg higher has pushed the pair above the 100-day SMA at 1.3783, signaling a potential shift toward a more bullish near-term bias.

The Relative Strength Index (RSI) at 65 moves away from its midline and approaches overbought territory, signaling firm upside momentum rather than exhaustion at this stage.

The Moving Average Convergence Divergence (MACD) line holds above its Signal line in positive territory, and the positive histogram persists, which reinforces the view that buying pressure dominates the current leg higher.

On the upside, a sustained move above the 100-day SMA could pave the way for initial resistance at 1.3850, which aligns closely with the January 22 high, followed by the 1.3900 psychological level.

On the downside, failure to hold above the 100-day SMA could see the pair retest the 1.3700-1.3750 zone, which has now turned into support after previously capping gains. Holding above this region keeps the bullish bias intact, while a break below would tilt the outlook back to the downside.

(This story was corrected on March 25 at 18:15 GMT to say that USD/CAD extends gains for a third straight session, not a second session.)

BNP Paribas argues that European Union (EU) manufacturing firms enter the 2026 energy shock from Iran with historically low non-performing loan (NPL) ratios, suggesting stronger financial health than in 2022. The bank notes that support measures will likely be more limited due to budget constraints, but highlights potential resilience from defence, public infrastructure and AI-related orders, which could help contain bankruptcies and unemployment.

Manufacturing NPLs low but policy support uncertain

"During her hearing on 18 March 2026 before the Committee on Economic and Monetary Affairs of the European Parliament, Claudia Buch (Chair of the Supervisory Board of the European Central Bank) highlighted the absence of decline in the quality of bank assets and the stability of non-performing loan ratios. These ratios are a good indirect indicator of the financial health of borrowing corporations in the European Union (EU), particularly in the manufacturing sector."

"In most individual European Union countries, the NPL ratio for the manufacturing sector now stands at a historically low level. Furthermore, the highest ratios at the start of the observation period typically recorded the sharpest declines."

"In the majority of cases, NPL ratios were reduced by more than half between Q2 2019 and Q4 2025. In cases where they increased during this latter period, the increases generally remained modest."

"Overall, the decline in the manufacturing sector’s NPL ratio in most European countries tends to indicate improved financial health. The manufacturing sector’s initial ability to withstand the energy shock linked to the 2026 war in Iran is therefore, in theory, greater than it was at the onset of the 2022 war in Ukraine."

"However, orders pertaining to defence, public infrastructure and AI are expected to provide new sources of resilience which, combined with the European manufacturing sector’s initially robust financial health, could help limit the impact of the 2026 energy shock on business bankruptcies and unemployment."

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