Forex News
- WTI fell after US President Trump ruled out immediate military strikes against Iran.
- Houthi attacks on Saudi targets and potential Post-Election Iranian retaliation keep geopolitical risks elevated.
- Trump implemented costly policy measures, including easing Russian fuel sanctions, to tackle high diesel prices.
West Texas Intermediate (WTI) oil price declines after registering over 4% gains in the previous trading day, hovering around $101.10 during Asian hours on Monday. Crude oil prices declined after US President Donald Trump ruled out immediate military action against Iran, stating, “there will not be a strike today,” according to Al Jazeera. This followed earlier remarks where Trump suggested Washington might need to “finish the job” or potentially reach a deal with Tehran amidst growing Iranian and Houthi threats against American interests in the region.
However, fears remain that strikes against Iran could resume following this week’s Israeli elections and next week’s US midterm elections, with Iran reportedly prepared to retaliate by targeting Israel and the UAE.
Adding to regional tensions, Yemen's Houthis declared on Sunday that they will continue targeting Saudi Arabia's King Khalid Airport in Riyadh, as reported by Reuters. This announcement came just hours after Saudi officials stated that airport flights had resumed despite repeated attacks by the group.
Conflict in the area persisted over the weekend, with the Houthis claiming attacks on the Saudi airport and oil facilities on Saturday, while Saudi Arabia reported on Sunday that it had intercepted additional missiles and drones. The top oil exporter restarted partial operations at its main airport on Sunday following damage from previous Houthi strikes, even as the militant group vowed to maintain its offensive.
Meanwhile, with the November midterm elections fast approaching, President Donald Trump is deploying a range of costly and politically fraught measures to address stubborn diesel prices. To lower costs, his administration has offered billions of dollars to farmers, relaxed regulations for truckers, eased sanctions on Russian fuel, and pressured European allies to release emergency oil stocks.
Oil outlook stays biased higher as election risks keep escalation premium in play
According to TD Securities, crude prices are likely to remain supported in the coming weeks, with the bank highlighting that “we expect crude oil will remain skewed to the upside in the near term as escalation risk ahead of Israeli elections and US midterm elections remains elevated.” This persistent geopolitical risk premium, in their view, continues to underpin a constructive bias for oil despite broader market uncertainties.
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.
- RBA Assistant Governor Sarah Hunter warned interest rates may rise further due to persistent inflation.
- CME FedWatch Tool suggests that markets price in a 90.6% chance the Fed holds rates steady in October.
- Traders monitor Middle East developments, including US-Iran tensions and Houthi attacks in Saudi Arabia.
AUD/USD depreciates after posting modest gains in the previous trading day, trading around 0.7030 during Asian hours on Monday. However, the downside of the currency pair could be restrained as the Australian Dollar (AUD) may receive support following warnings from Reserve Bank of Australia (RBA) Assistant Governor Sarah Hunter.
Speaking on Sunday, Hunter cautioned that interest rates may need to rise further due to stubborn inflation and the risk of overseas price pressures becoming entrenched in the economy. Her remarks reinforced expectations of a restrictive monetary stance following four rate hikes earlier this year.
Market focus now shifts to September inflation data scheduled for release later this week, especially after August CPI figures remained above the RBA's target range of 2% to 3%. Furthermore, any renewed escalation in the US-Iran conflict that drives up crude oil prices would deepen the RBA’s concerns regarding second-round inflation effects, increasing the likelihood of further policy tightening beyond November.
RBA faces credibility test as inflation expectations drift above target
Commerzbank’s Norman Liebke flags a worrying shift in domestic inflation psychology, noting that survey evidence now shows “a growing share of businesses believe that inflation of 3-3.5% is ‘the new normal’.” He argues that this is problematic for the RBA’s inflation-targeting framework, given the “long-term inflation target of 2-3%,” and underscores that the risk is not merely theoretical: “trimmed-mean inflation most recently stood at 3.6%, further above the target range.” In his view, this combination of elevated core inflation and drifting expectations reinforces the challenge facing policymakers as markets increasingly price in the prospect of further RBA tightening.
Traders have also turned their attention to the upcoming Federal Reserve policy decision. The Fed is widely expected to hold interest rates steady before potentially pursuing another rate hike in December. According to the CME FedWatch Tool, markets are currently pricing in a 90.6% probability of a rate pause at the October 27–28 policy meeting, alongside a 79.7% chance of a hike in December.
Meanwhile, market participants continue to monitor ongoing geopolitical developments in the Middle East. US President Donald Trump ruled out immediate military action against Iran, stating, “there will not be a strike today,” according to Al Jazeera. This followed earlier remarks where Trump suggested Washington might need to “finish the job” or potentially reach a deal with Tehran amidst growing Iranian and Houthi threats against American interests in the region.
Adding to regional tensions, Yemen's Houthis declared on Sunday that they will continue targeting Saudi Arabia's King Khalid Airport in Riyadh, as reported by Reuters. This announcement came just hours after Saudi officials stated that airport flights had resumed despite repeated attacks by the group.
Australian Dollar FAQs
One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.
The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.
China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.
Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.
The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
A Chinese official stated that it “firmly opposes” a US Treasury proposal to expand the scope and increase the severity of restrictions on US investment in China, calling it discriminatory and “a typical example of an overly broad application of national security concerns,” Bloomberg reported over the weekend.
China’s Commerce Ministry said it would watch subsequent developments closely and warned the rule would damage economic ties between the two countries, adding that China retains the right to take corresponding measures, without specifying what those might be.
On Thursday, the US Treasury proposed a rule expanding the Outbound Investment Security Program, tightening limits on US investment in hypersonics, quantum, high-performance computing, supercomputing and AI in China, Russia and North Korea. The measure also added biotechnology to the targeted sectors.
Market reaction
The China-proxy Australian Dollar (AUD) edges lower following this developments. At the time of writing, the AUD/USD pair is down 0.09% on the day at 0.7028.
US-China Trade War FAQs
Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living.
An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies.
The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
Ukrainian President Volodymyr Zelenskyy said that a trilateral meeting between Kyiv, Washington and Moscow would take place in November, Reuters reported on Sunday.
Key quotes
Territory issue only for heads of state, technical talks cover other matters.
Progress on unlocking Patriot missile supplies to Ukraine very slow.
US, Ukraine, Russia trilateral meeting planned for November.
US intelligence sharing on Russian ballistic missile strike warnings fully resumes.
Starshield service restored with speeds up to 420 kph.
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.
US President Donald Trump has ruled out immediate military action against Iran, saying “there will not be a strike today,” Aljazeera news agency reported on Sunday.
Earlier, Trump suggested Washington might have to “finish the job” or could reach a deal with Tehran as Iranian and Houthi threats against Americans in the Middle East continue to grow.
Iran’s parliament speaker, Mohammad Bagher Ghalibaf said that the US has entered a “quagmire” because of miscalculations in launching the war and Washington must now “take the necessary steps to extricate” itself.
Iran’s Foreign Ministry spokesperson, Esmail Baghaei, stated that Tehran has not closed the window of diplomacy and messages are being passed to the US via intermediaries. Negotiations over the war have appeared to stall for weeks.
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.
Yemen's Houthis said on Sunday that they will keep attacking Saudi Arabia's King Khalid Airport in Riyadh, Reuters reported. This move came hours after the kingdom announced that flights had resumed despite repeated attacks by Houthis.
Houthi military spokesperson Yahya Saree vowed the facility would "never be safe" and urged airlines, airport staff and travellers not to use it. Saree stated that the group had "conducted three military operations with dozens of ballistic missiles," claiming the strike on the airport achieved its target.
The militant group also attacked Saudi Arabia's King Fahd International Airport in Dammam, Najran airport and Khamis Mushait airbase.
A Saudi-led coalition reported over the weekend that it intercepted and destroyed two ballistic missiles launched by Yemen's Houthis towards Taif and Yanbu.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
- Gold price remains on the defensive around $3,995 in Monday’s early Asian session.
- Higher energy prices fueled inflation concerns and reinforced US rate hike expectations.
- Traders see a 90.6% chance the Fed will leave rates unchanged this week and a 79.4% probability of a December hike.
Gold price (XAU/USD) declines to near $3,995 during the early Asian session on Monday. The precious metal remains under some selling pressure near its lowest since July as elevated energy prices reinforced inflation concerns before the Federal Reserve’s (Fed) next policy meeting.
WTI crude oil price reached a more than five-month high after Houthi attacks in Saudi Arabia stoked concern over further disruption to energy supplies.
Uncertainty in the Middle East remains high as US President Donald Trump said over the weekend that it’s “getting to be decision time” on whether he will make a deal with Tehran or resume attacks as Iranian and Houthi threats against Americans in the Middle East continue to grow.
“Gold is being weighed down by concerns around oil prices, rates and the Fed outlook,” said Ryan McKay, senior commodity strategist at TD Securities. “At the margin, flows have also been negative, with heavy CTA selling this week adding to the pressure.”
While traders see a small chance of a quarter-point rate increase at the policy meeting next week, higher oil prices have also prompted bets on another hike in December. Higher interest rates typically weigh on gold because the precious metal does not pay interest, making yield-bearing assets relatively more attractive.
Markets are now pricing in a 79.4% likelihood that the Fed will raise interest rates in December, according to the CME FedWatch tool, with 90.6% odds that the US central bank will hold rates unchanged at its upcoming meeting this month.
Gold slides as oil surge revives Fed tightening fears
Strategists at OCBC report that gold "came under renewed selling pressure overnight, falling more than 2.5%," even as broader markets were roiled by a global tech selloff. They note that "Brent’s sharp rise amid renewed Middle East supply concerns added to inflation worries and expectations that the Fed may need to keep rates restrictive for longer," compounding the headwinds for the metal. What OCBC finds particularly notable is that "gold continued to weaken even as US Treasury yields fell sharply," underscoring that "neither lower yields nor heightened geopolitical uncertainty has been sufficient to support gold, suggesting that near-term sentiment remains fragile."
Against this backdrop, the bank says "we remained cautious in the near term, particularly as gold has struggled to respond positively to the recent decline in yields." Looking ahead, OCBC argues that "an easing in oil prices and further decline in real yields could help gold stabilise," but stresses that they "would want to see a better price response before turning more constructive in the near-term."
Warsh flags investment surge and AI risks as Fed keeps options open
Fed Chair Warsh’s remarks score 5.6/10 on the FXS Speechtracker, modestly below the 6.1/10 historical average, pointing to a slightly less impactful tone relative to the established baseline despite broadly steady policy messaging. The admission of being “over-scarred” by the Global Financial Crisis, combined with emphasis on an investment surge driven by “good policies” and caution about AI’s uncertain employment impact, underscores a risk-aware stance that balances optimism on structural growth with sensitivity to downside tails. Warsh’s refusal to pre-judge the October and December meetings keeps the policy path deliberately opaque, limiting immediate repricing in Dollar expectations.
The FXS Fed Sentiment Index was unchanged, moving 0.00 points to a still-elevated level of 127.51, signaling that the speech left the perceived policy stance firmly in hawkish territory. The steady index reading, alongside a slightly softer FXS Speechtracker score, suggests markets see no material shift in the Fed’s reaction function, with Dollar support underpinned by high conviction on price stability and vigilance over financial stability risks.
Technical Analysis: Gold retains a negative outlook below the 100-day SMA
In the daily chart, XAU/USD keeps a bearish near-term bias as spot remains capped beneath the 100-day simple moving average (SMA) and the 20-day Bollinger middle band. Price also trades below the lower Bollinger band, underscoring downside pressure after the recent break of the envelope, while the Relative Strength Index (14) at 34.13 hovers just above oversold territory, hinting that selling momentum is still dominant but nearing stretched conditions.
On the topside, initial resistance emerges at the lower Bollinger band around $4,015, followed by the Bollinger 20-day SMA at $4,130. Above that, the 100-day SMA at $4,220 and the upper Bollinger band at $4,240 form a broader supply zone that would need to be reclaimed to ease the current bearish tone and open the way for a more sustained recovery.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
- USD/JPY forms hammer candle near support, hinting at potential recovery.
- Bearish RSI below neutral keeps sellers favored despite reversal signals.
- Break below 156.08 exposes 155.00, while 157.57 caps recovery attempts.
The Japanese Yen finished the week on a higher note as the USD/JPY pair registered losses of over 0.74% in the week, while holding firm daily amid a sour market mood. The pair trades at 156.85 as a ‘hammer candle pattern’ forms.
USD/JPY Price Forecast: Technical outlook
Price action is consistent for further sideways action, with the USD/JPY trapped within the 156.00-159.00, 300-pip range, with neither buyers nor sellers able to decisively clear immediate support and resistance levels, delineated by the range.
Momentum shifted bearish, with the 14-day Relative Strength Index (RSI) edging below its 50-neutral level, indicating that sellers are strengthening.
Therefore, the path of least resistance is downwards. The first support is the 156.50 psychological level. Beneath lies the October 23 daily low of 156.08 before sellers aim towards the 155.00 milestone. A breach of the latter will expose the September 8 swing low of 152.89.
Upward, the first USD/JPY resistance is the 50-day Simple Moving Average (SMA) at 157.57. On further strength, the next stop is the 100-day SMA at 158.50, followed by the 200-day SMA at 159.35.
USD/JPY Price Chart – Daily
Japanese Yen Price This week
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies this week. Japanese Yen was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.46% | -0.77% | -0.81% | -1.12% | -0.74% | -0.14% | |
| EUR | 0.15% | -0.31% | -0.56% | -0.61% | -0.88% | -0.58% | 0.03% | |
| GBP | 0.46% | 0.31% | -0.25% | -0.30% | -0.56% | -0.26% | 0.41% | |
| JPY | 0.77% | 0.56% | 0.25% | -0.05% | -0.35% | 0.02% | 0.75% | |
| CAD | 0.81% | 0.61% | 0.30% | 0.05% | -0.29% | 0.09% | 0.71% | |
| AUD | 1.12% | 0.88% | 0.56% | 0.35% | 0.29% | 0.30% | 0.94% | |
| NZD | 0.74% | 0.58% | 0.26% | -0.02% | -0.09% | -0.30% | 0.66% | |
| CHF | 0.14% | -0.03% | -0.41% | -0.75% | -0.71% | -0.94% | -0.66% |
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 Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
- AUD/USD extends weekly gains, reclaiming 0.7000 and testing key resistance.
- Bulls challenge SMA confluence, with 0.7074 guarding further upside.
- Break above 0.7100 exposes 0.7150 and September high at 0.7237.
The Australian Dollar finished Friday’s session with gains of over 0.22% and the week up by more than 1.20%, with the pair reclaiming the 0.7000 figure and poised to test a confluence of key resistance levels within the 0.7000-0.7100 range. At the time of writing, the AUD/USD trades at 0.7035.
AUD/USD Price Forecast: Technical outlook
After climbing from around 0.6900 in mid-October to current exchange rates, the AUD/USD bias has turned bullish in the near term. Along with a constructive technical picture, expectations that the Reserve Bank of Australia (RBA) will increase rates again before next year, underpinned the Aussie.
From a technical perspective, buyers face key resistance at the 100-, 50- and 200-day Simple Moving Averages (SMAs), each at 0.7033, 0.751 and 0.7074, respectively. Once that area is cleared, a potential move towards 0.7100 is on the cards.
Above the next stop is the 0.7150 psychological level, followed by the September 9 daily high of 0.7237. A move beyond that level will expose the year-to-date (YTD) high of 0.7277.
On the flip side, the first support for AUD/USD is the 0.7000 level. Once hurdled, the next area of interest would become the October 15 cycle low of 0.6894.
AUD/USD Price Chart – Daily
Australian Dollar Price This week
The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.46% | -0.77% | -0.81% | -1.12% | -0.74% | -0.14% | |
| EUR | 0.15% | -0.31% | -0.56% | -0.61% | -0.88% | -0.58% | 0.03% | |
| GBP | 0.46% | 0.31% | -0.25% | -0.30% | -0.56% | -0.26% | 0.41% | |
| JPY | 0.77% | 0.56% | 0.25% | -0.05% | -0.35% | 0.02% | 0.75% | |
| CAD | 0.81% | 0.61% | 0.30% | 0.05% | -0.29% | 0.09% | 0.71% | |
| AUD | 1.12% | 0.88% | 0.56% | 0.35% | 0.29% | 0.30% | 0.94% | |
| NZD | 0.74% | 0.58% | 0.26% | -0.02% | -0.09% | -0.30% | 0.66% | |
| CHF | 0.14% | -0.03% | -0.41% | -0.75% | -0.71% | -0.94% | -0.66% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
- USD/MXN falls to 18.66, but the Peso faces weekly losses exceeding 1%.
- Mexico's economic activity grows 3.3% annually, exceeding previous readings.
- December Fed hike odds reach 78% ahead of FOMC and PCE releases.
The Mexican Peso (MXN) appreciates about 0.30% on Friday against the US Dollar (USD), but it remains poised to end the week with losses of more than 1% even as risk appetite soured amid a potential escalation of the Middle East conflict. The USD/MXN pair trades at 18.66 after hitting 18.80.
USD/MXN retreats as resilient Mexican economic activity offsets geopolitical uncertainty ahead of Fed decision
The US-Iran conflict continues to escalate as US President Donald Trump said that “we may do another operation against Iran.” Meanwhile, the Islamic Revolutionary Guard Corps (IRGC) is attacking vessels using “illegal routes” in the Strait of Hormuz, while Houthi-Saudi exchanges of fire further deteriorated market sentiment.
In Mexico, economic activity rose 0.6% MoM in August, as measured by the Global Economic Activity Indicator. Annually, the print increased by 3.3%, with figures usually released ahead of Gross Domestic Product (GDP) data.
In the US, the University of Michigan Consumer Sentiment Index fell slightly to a five-month low of 48 in October, from 48.1, as energy prices rose and consumers expected the Federal Reserve (Fed) to keep rates higher for longer. Inflation expectations were unchanged but remained above the Fed’s 2% target: 4.7% over the next 12 months and 3.5% over five years.
US S&P Global PMIs showed manufacturing activity rising from 55.9 to 56 and services easing from 58.8 to 57.9, in line with analyst expectations.
Last week, US inflation data was hot on both the producer and consumer fronts, paving the way for further tightening by the Federal Reserve. Nevertheless, investors took a rate hike off the table for next week’s Fed meeting. But for December, the chances are 78%, according to Prime Terminal.
Next week, the US economic docket will feature the Federal Reserve’s monetary policy meeting, followed by the release of the Fed’s favorite inflation gauge, the Core Personal Consumption Expenditures (PCE) Price Index.
In Mexico, the schedule will feature the release of GDP figures on Friday.
USD/MXN Price Forecast: Technical outlook
In the daily chart, USD/MXN trades at 18.6532, extending its advance well above the clustered simple moving averages around 17.5753 and the former downtrend resistance now turned support near 14.8414. This positioning keeps the near-term bias bullish, with the pair holding comfortably over the horizontal floor at 16.8866. The Relative Strength Index (14) at 70.48 flirts with overbought territory, suggesting that while upside pressure remains dominant, the rally could be prone to bouts of consolidation or shallow corrective pullbacks.
On the downside, initial demand is seen at the grouped simple moving averages around 17.58, which reinforce the broader bullish structure, ahead of the horizontal support level at 16.89. Deeper setbacks would still find protection from the broken downward trend line anchored near 14.84. With no meaningful resistance levels immediately overhead in the current framework, price action may continue to probe higher levels as long as USD/MXN holds above the 17.58 support zone.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Mexican Peso FAQs
The Mexican Peso (MXN) is the most traded currency among its Latin American peers. Its value is broadly determined by the performance of the Mexican economy, the country’s central bank’s policy, the amount of foreign investment in the country and even the levels of remittances sent by Mexicans who live abroad, particularly in the United States. Geopolitical trends can also move MXN: for example, the process of nearshoring – or the decision by some firms to relocate manufacturing capacity and supply chains closer to their home countries – is also seen as a catalyst for the Mexican currency as the country is considered a key manufacturing hub in the American continent. Another catalyst for MXN is Oil prices as Mexico is a key exporter of the commodity.
The main objective of Mexico’s central bank, also known as Banxico, is to maintain inflation at low and stable levels (at or close to its target of 3%, the midpoint in a tolerance band of between 2% and 4%). To this end, the bank sets an appropriate level of interest rates. When inflation is too high, Banxico will attempt to tame it by raising interest rates, making it more expensive for households and businesses to borrow money, thus cooling demand and the overall 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.
Macroeconomic data releases are key to assess the state of the economy and can have an impact on the Mexican Peso (MXN) valuation. A strong Mexican economy, based on high economic growth, low unemployment and high confidence is good for MXN. Not only does it attract more foreign investment but it may encourage the Bank of Mexico (Banxico) to increase interest rates, particularly if this strength comes together with elevated inflation. However, if economic data is weak, MXN is likely to depreciate.
As an emerging-market currency, the Mexican Peso (MXN) tends to strive during risk-on periods, or when investors perceive that broader market risks are low and thus are eager to engage with investments that carry a higher risk. Conversely, MXN tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
Forex Market News
Our dedicated focus on forex news and insights empowers you to capitalise on investment opportunities in the dynamic FX market. The forex landscape is ever-evolving, characterised by continuous exchange rate fluctuations shaped by vast influential factors. From economic data releases to geopolitical developments, these events can sway market sentiment and drive substantial movements in currency valuations.
At Rakuten Securities Hong Kong, we prioritise delivering timely and accurate forex news updates sourced from reputable platforms like FXStreet. This ensures you stay informed about crucial market developments, enabling informed decision-making and proactive strategy adjustments. Whether you’re monitoring forex forecasts, analysing trading perspectives, or seeking to capitalise on emerging trends, our comprehensive approach equips you with the insights needed to navigate the FX market effectively.
Stay ahead with our comprehensive forex news coverage, designed to keep you informed and prepared to seize profitable opportunities in the dynamic world of forex trading.
