Forex News

TD Securities strategists argue that Kevin Warsh’s path to the Fed chair and related independence concerns mostly point to a weaker Dollar in 2026. They map FX reactions across several Fed leadership scenarios, highlighting that Miran-related, politicized outcomes could generate the sharpest USD downside, while a status-quo extension for Powell would be moderately supportive for USD.

Fed scenarios mostly Dollar negative

"FX outcomes across the scenarios hinge on two factors: (1) expectations for the future policy path and (2) the extent to which concerns around Fed independence introduce additional risk premia. While the policy outlook will continue to be driven primarily by realized growth and inflation data, it is the second channel—credibility and independence—that differentiates FX performance across scenarios. Majority of the paths lead to some sort of bearish reaction in the dollar, which also supports our negative USD lean in 2026."

"Reaction hinges on policy expectations and Fed independence risks; most scenarios under Warsh-led transitions skew moderately USD negative, with a Miran-led transition and politicized outcome posing the greatest downside risk."

"In Scenarios 1 and 3 where Warsh takes over as Chair, moderate bull steepening for the Treasury yield curve would lead to moderately weaker USD. In these scenarios, potential logistics changes for the FOMC under the new chair and lingering questions over the Chair’s perceived independence relative to Powell are likely to weigh on the dollar. By contrast, Scenario 2a, which maintains the status quo would likely see bear flattening of the curve and be moderately bullish for the USD."

"Scenario 2b is the most political outcome and would likely lead to some degree of erosion to the credibility of the Fed as an apolitical and independent institution. At the same time, a more dovish Miran also joins the contention for the Fed Chair position. We would expect this scenario to lead to the most USD downside."

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

ING strategists Warren Patterson and Ewa Manthey describe a cautious backdrop for base metals, with Copper and Aluminium edging higher after reduced near-term geopolitical risk but ongoing Strait of Hormuz closure. They highlight demand pressure from high energy costs, supply disruptions supporting Aluminium, and rising supply risks for Copper from sulphuric acid shortages and China’s planned export suspension.

Copper and aluminium face supply risks

"Copper and aluminium edged higher yesterday after US President Donald Trump extended the Iran ceasefire indefinitely, reducing near-term geopolitical risk."

"However, the Strait of Hormuz remains closed, with Tehran signalling it will not reopen the route while the US blockade persists."

"Signals across the metals complex remain mixed."

"Aluminium has found support from supply disruptions in the Middle East, which accounts for around 9% of global output."

"Copper supply faces growing risks, amid potential sulphuric acid shortages due to shipping disruptions and China’s planned export suspension from May."

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

• Initial Jobless Claims increase to 214K in the week ending April 18, above forecasts.
• Continuing Jobless Claims increased to 1.821M from a previous revised 1.809M.

The US Department of Labor (DOL) reported on Thursday that the number of US citizens filing new applications for unemployment insurance rose to 214K for the week ending April 18, an increase of 6,000 from the previous week's revised level. The previous week's level was revised up from 207K to 208K.

Additionally, the advance number for seasonally adjusted insured unemployment during the week ending April 11 was 1.821K, an increase of 12K from the previous week's revised level. The previous week's level was revised down by 9K from 1.818K to 1.809K.

Market reaction

The US Dollar (USD) holds on to intraday gains across the FX board following the data, which failed to trigger a reaction. Market participants maintain the focus on the Iran war developments and Crude Oil Prices.