Forex News
- AUD/USD hits session highs near 0.7270 for the first time since June 2022.
- Hopes of a US-Iran peace deal have boosted risk appetite, crushing demand for the US Dollar.
- Australian AIG Industry Index improved in March, providing additional support to the AUD.
The Australian Dollar (AUD) accelerated its uptrend against the US Dollar (USD) on Wednesday, breaching previous highs at the 0.7225 area and hitting levels near 0.7270 for the first time since June 2022. News that the US and Iran would be close to a peace agreement has boosted risk appetite, sending the safe-haven USD tumbling.
Investors have celebrated a report by the Axios news agency, which cites two US officials and other sources related to the matter, to suggest that Washington and Tehran are closing in on a one-page memorandum to put an end to the war.
Previously, US President Donald Trump put Operation Freedom to escort vessels through the Strait of Hormuz on hold, after liberating three ships in two days. Furthermore, US Secretary of State Marco Rubio affirmed at a press conference on Tuesday that the US had achieved all the objectives of the war and that the offensive phase was over, suggesting that the US is not willing to resume hostilities.
Australian data support the Aussie
On the economic docket, Australian AiG Industry Index data released earlier on Wednesday has shown a significant improvement to -24.4 in March from a nearly two-year low at -34.2 in February, highlighting some stabilisation of factory activity. The Aussie appreciated following the data.
On Thursday, Australian Trade Balance figures from March will be observed with interest to assess the impact of the Middle East conflict on international trade, which accounts for nearly the 50% of the country’s Gross Domestic Product (GDP).
Before that, the US ADP Employment Change will provide the first glimpse of April’s labour market. ADP’s figures, which are expected to show a moderate growth in job creation, will set the stage for Friday’s Nonfarm Payrolls report, which is expected to put the Federal Reserve’s (Fed) hawkish turn into context.
(This story was corrected on May 6 at 12:10 GMT to say that the session high near 0.7220 is the highest level since June 2022, not August, and that Wednesday's AiG Industry Index was for March and not from April, as previously reported.)
Economic Indicator
ADP Employment Change
The ADP Employment Change is a gauge of employment in the private sector released by the largest payroll processor in the US, Automatic Data Processing Inc. It measures the change in the number of people privately employed in the US. Generally speaking, a rise in the indicator has positive implications for consumer spending and is stimulative of economic growth. So a high reading is traditionally seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Wed May 06, 2026 12:15
Frequency: Monthly
Consensus: 99K
Previous: 62K
Source: ADP Research Institute
Traders often consider employment figures from ADP, America’s largest payrolls provider, report as the harbinger of the Bureau of Labor Statistics release on Nonfarm Payrolls (usually published two days later), because of the correlation between the two. The overlaying of both series is quite high, but on individual months, the discrepancy can be substantial. Another reason FX traders follow this report is the same as with the NFP – a persistent vigorous growth in employment figures increases inflationary pressures, and with it, the likelihood that the Fed will raise interest rates. Actual figures beating consensus tend to be USD bullish.
Economic Indicator
Trade Balance (MoM)
The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.
Read more.Next release: Thu May 07, 2026 01:30
Frequency: Monthly
Consensus: 4,250M
Previous: 5,686M
Source: Australian Bureau of Statistics
- The Japanese Yen strengthens sharply amid suspicions of intervention by Japanese authorities in the FX market.
- Axios reports that Washington and Tehran are close to a deal aimed at ending the conflict and reopening nuclear talks.
- Easing geopolitical tensions weigh on the US Dollar and accelerate the decline in USD/JPY.
USD/JPY drops sharply on Wednesday and trades around 155.80 at the time of writing, down 1.31% on the day, as the Japanese Yen (JPY) benefits from both suspected intervention by Japanese authorities and broad-based weakness in the US Dollar (USD).
According to Axios, the United States (US) and Iran are close to reaching a memorandum of understanding aimed at ending the conflict and opening a broader negotiation phase regarding Iran’s nuclear program. The discussions reportedly include a gradual easing of restrictions around the Strait of Hormuz, an Iranian moratorium on nuclear enrichment, as well as an easing of US sanctions and the release of billions of dollars in frozen Iranian funds.
The US news outlet added that the White House expects Tehran to respond on several key points within the next 48 hours. A Pakistani source involved in the diplomatic efforts also told Reuters that both sides were “very close” to finalizing a deal.
These developments are fueling a strong risk-on move across financial markets and reducing the geopolitical risk premium linked to fears of disruptions to global energy supply. The US Dollar Index (DXY) loses 0.80% on Wednesday and falls to near 97.70 at the time of press, adding further bearish pressure on USD/JPY.
At the same time, investors remain alert to the possibility of further intervention by Japan’s Ministry of Finance. Japanese authorities are suspected of having already spent around 5.48 trillion JPY, or nearly $35 billion, last week to support the Japanese currency after USD/JPY breached the psychological 160.00 level.
Japanese Finance Minister Satsuki Katayama recently reiterated that Tokyo remains ready to take “decisive measures” against speculative moves in the foreign exchange market. MUFG also estimates that the recent decline in USD/JPY is consistent with another intervention by Japanese authorities.
Markets are now awaiting the US ADP Employment Change report later on Wednesday, ahead of Friday’s official labor market figures.
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 Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.77% | -0.66% | -1.20% | -0.16% | -1.06% | -1.51% | -0.64% | |
| EUR | 0.77% | 0.10% | -0.48% | 0.63% | -0.29% | -0.77% | 0.13% | |
| GBP | 0.66% | -0.10% | -0.62% | 0.53% | -0.39% | -0.86% | 0.05% | |
| JPY | 1.20% | 0.48% | 0.62% | 1.11% | 0.18% | -0.27% | 0.65% | |
| CAD | 0.16% | -0.63% | -0.53% | -1.11% | -0.91% | -1.36% | -0.47% | |
| AUD | 1.06% | 0.29% | 0.39% | -0.18% | 0.91% | -0.45% | 0.44% | |
| NZD | 1.51% | 0.77% | 0.86% | 0.27% | 1.36% | 0.45% | 0.90% | |
| CHF | 0.64% | -0.13% | -0.05% | -0.65% | 0.47% | -0.44% | -0.90% |
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).
Brown Brothers Harriman’s (BBH) Elias Haddad expects the National Bank of Poland (NBP) to keep its policy rate at 3.75% for a second consecutive meeting, effectively signalling an end to its 200 bps easing cycle over the past year. With headline and core Consumer Price Index (CPI) running above NBP projections and a favourable balance of payments, Haddad argues positive real rates continue to underpin the Polish Zloty (PLN).
Stable policy and supportive real rates
"National Bank of Poland (NBP) is widely expected to keep the policy rate unchanged at 3.75% for a second straight meeting today."
"NBP will likely signal that its easing cycle, which saw it deliver 200bps of cuts in the past year, is over."
"Poland headline and core CPI inflation are tracking above the NBP’s Q1 projection of 2.2% and 2.6%, respectively."
"Poland’s positive real rates and favorable balance of payments backdrop continue to underpin PLN."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- The US Dollar Index drops more than 0.7% on Wednesday amid hopes of a US-Iran deal.
- Axios reports that Washington and Tehran are close to an agreement that sets the framework for nuclear talks.
- ADP Employment Change figures later on Wednesday will set the stakes for Friday's NFP report.
The US Dollar (USD) depreciates against its main peers on Wednesday amid hopes that the US and Iran are close to a deal to end the war. The USD Index (DXY), which measures the US Dollar against a basket of currencies, drops more than 0.7% on the day, approaching pre-war levels at 97.50.
A report by Axios, citing two US officials and other sources briefed on the issue, affirmed on Wednesday that the US and Iranian representatives are getting closer to a one-page memorandum of understanding to end the conflict, which defines the framework for more detailed nuclear negotiations at a later time.
This news comes after US President Donald Trump put the Operation Freedom to escort vessels through the Strait of Hormuz in pause, and US Secretary of State Marco Rubio affirmed that the US had achieved all the objectives of the war, signalling the end of the offensive stage.
Apart from that, the USD/JPY pair dropped sharply during Wednesday’s Asian session, allegedly due to an intervention by the Japanese Ministry of Finance (MOF). Although the pair has managed to regain some of the lost ground, this Japanese Yen (JPY) strength has added negative pressure on the DXY.
Later on Wednesday, the US ADP Employment Change Report is expected to show that private employment payrolls increased to 99K in April, from 62K in March. These figures would set a positive precedent that, if confirmed by Friday’s Nonfarm Payrolls report, would buy time for the Federal Reserve to better assess the economic impact of the war.
Economic Indicator
ADP Employment Change
The ADP Employment Change is a gauge of employment in the private sector released by the largest payroll processor in the US, Automatic Data Processing Inc. It measures the change in the number of people privately employed in the US. Generally speaking, a rise in the indicator has positive implications for consumer spending and is stimulative of economic growth. So a high reading is traditionally seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Wed May 06, 2026 12:15
Frequency: Monthly
Consensus: 99K
Previous: 62K
Source: ADP Research Institute
Traders often consider employment figures from ADP, America’s largest payrolls provider, report as the harbinger of the Bureau of Labor Statistics release on Nonfarm Payrolls (usually published two days later), because of the correlation between the two. The overlaying of both series is quite high, but on individual months, the discrepancy can be substantial. Another reason FX traders follow this report is the same as with the NFP – a persistent vigorous growth in employment figures increases inflationary pressures, and with it, the likelihood that the Fed will raise interest rates. Actual figures beating consensus tend to be USD bullish.
- WTI plunges around $91.00 on Wednesday, down 8.91% on the day, after Axios reported a possible agreement between the United States and Iran.
- The proposed deal would reportedly include a gradual lifting of restrictions in the Strait of Hormuz and an easing of US sanctions on Iran.
- The sharp improvement in market sentiment significantly reduces the geopolitical risk premium embedded in Oil prices.
West Texas Intermediate (WTI) US Oil falls sharply on Wednesday and trades around $91.00 at the time of writing, posting an 8.91% daily decline as markets rapidly reassess geopolitical risks in the Middle East following reports from Axios suggesting major progress between the United States (US) and Iran.
According to Axios, Washington and Tehran are close to reaching a memorandum of understanding aimed at ending the conflict and opening a broader negotiation period regarding Iran’s nuclear program. The discussions reportedly include a gradual lifting of restrictions around the Strait of Hormuz, an Iranian moratorium on nuclear enrichment, as well as an easing of US sanctions alongside the release of billions of dollars in frozen Iranian funds.
The US news outlet added that the White House expects Iran to respond on several key points within the next 48 hours. A Pakistani source involved in the diplomatic efforts also confirmed to Reuters that both sides were “very close” to finalizing a deal.
The developments triggered a strong risk-on move across financial markets and led to a sharp decline in Oil prices, as investors rapidly unwind the geopolitical risk premium linked to potential supply disruptions.
The Strait of Hormuz remains a strategic chokepoint for the global energy market, with roughly one-fifth of global Oil flows transiting through the passage. Any lasting improvement in the regional situation mechanically reduces fears of disruptions to crude exports.
The bearish move accelerated after US President Donald Trump stated that “Project Freedom”, the operation aimed at fully restoring commercial shipping through the Strait of Hormuz, would be temporarily paused to allow diplomatic negotiations to proceed. US Defense Secretary Pete Hegseth also stated that the US-Iran ceasefire “certainly holds for now”, while emphasizing that Washington was not seeking renewed escalation.
The decline in Oil prices comes despite still-tight physical market fundamentals. The American Petroleum Institute (API) reported on Tuesday a decline of 8.1 million barrels in US crude inventories last week, far above the 2.8 million-barrel draw expected by the consensus. Goldman Sachs also warned that global Oil inventories are approaching their lowest levels in the last eight years.
However, in the short term, markets are clearly focusing on the improving geopolitical outlook, considering that a potential agreement between the United States and Iran could gradually normalize energy flows in the region and ease supply-related risks for global markets.
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.
ING’s Warren Patterson and Ewa Manthey note Copper has edged higher, with LME prices back above $13,000/t as markets gauge the durability of the US-Iran ceasefire. They argue a prolonged Strait of Hormuz closure would raise energy costs and hurt manufacturing demand, leaving Copper headline-driven and needing stronger physical demand or inventory drawdowns for a sustained move higher.
Headline-driven trade and demand risks
"Copper edged higher as markets assessed whether the US-Iran ceasefire can hold. LME copper recovered on Tuesday afternoon from earlier losses in the session to trade back above $13,000/t. It’s supported by improved risk sentiment but capped by still-elevated exchange inventories, now close to the highest level since 2013."
"The main risk for metals remains a prolonged closure of the Strait of Hormuz. That would lift energy costs, add inflation pressure and weigh on manufacturing demand, limiting upside for industrial metals. Copper is likely to stay headline-driven, with stronger physical demand or inventory drawdowns needed for a more sustained move higher."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
According to Axios, the United States and Iran are moving towards a deal to end the conflict.
The news outlet claims that the deal would involve both sides lifting restrictions around transit through the Strait of Hormuz, in addition to Iran committing to a moratorium on nuclear enrichment and the US agreeing to lift its sanctions and release billions in frozen Iranian funds.
The US reportedly expects Iran to respond on several key points in the next 48 hours.
A Pakistani source involved in the peace efforts spoke to Reuters and cofirmed Axios' reporting, saying that they are very close to finalizing the deal.
Market reaction
Risk flows dominate the action in financial markets following this headline. The US Dollar Index loses more than 0.6% on the day near 97.90 and US stock index futures rise between 0.65% and 1.1% on the day.
Gold also benefits from this development and gains about 3% on the day near $4,700.
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
MUFG’s Derek Halpenny argues that recent USD/JPY moves likely reflect renewed Japanese Ministry of Finance intervention, with the pair dropping nearly three big figures after testing the 158.00 area. He warns that, given Middle East uncertainty and other unpredictable factors, this round of intervention may prove less successful in curbing upside momentum in USD/JPY than previous episodes.
Suspected MoF action drives sharp drop
"When considering the past behaviours of the MoF / BoJ in Japan regarding intervention, there is a strong likelihood that the Japanese authorities contributed to the broad sell-off of the US dollar with another bout of USD/JPY selling intervention."
"In all the past interventions, the MoF has never intervened just once. In 2022, intervention took place in September and October on a total of three separate trading days. In 2024, the MoF intervened twice at the end of April and beginning of May and then twice again in July 2024."
"Today, after hitting close to the 158-level, USD/JPY fell nearly three big figures and is of a scale that is consistent with actual intervention by the MoF. Finance Minister Katayama made clear on Monday that “bold action” can be taken in FX markets."
"If action has been taken today, the selling of the US dollar would have been reinforced by the decline in crude oil prices and increased hope of progress toward a peace deal. But we believe there remains a danger that these bouts of intervention could prove the least successful of any of the previous periods of intervention mentioned above. The Japanese authorities are more at the mercy of unpredictable factors than in the past."
"How the Middle East plays out will be crucial on whether upside momentum in USD/JPY fades. While there is optimism today over progress toward peace that could change suddenly at any time."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Silver prices (XAG/USD) rose on Wednesday, according to FXStreet data. Silver trades at $76.78 per troy ounce, up 5.42% from the $72.83 it cost on Tuesday.
Silver prices have increased by 8.01% since the beginning of the year.
Unit measure | Silver Price Today in USD |
|---|---|
Troy Ounce | 76.78 |
1 Gram | 2.47 |
The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 61.16 on Wednesday, down from 62.56 on Tuesday.
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.
(An automation tool was used in creating this post.)
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