Forex News
The US Dollar (USD) saw little movement this week after markets assessed the United States (US) President Donald Trump's nomination of Kevin Warsh, a former member of the Federal Reserve (Fed) Board of Governors, as the next Fed Chair, and the partial US government shutdown that pushed employment and inflation data to next week. The shutdown was ultimately resolved on Wednesday when President Trump signed a funding bill.
The US Dollar Index (DXY) is trading near the 97.60 price zone after hitting two-week highs earlier on Friday. Next week, the US ADP Employment Change four-week average will be released on Tuesday, Nonfarm Payrolls on Wednesday and Initial Jobless Claims on Thursday.
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 Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.33% | -0.55% | 0.05% | -0.27% | -1.03% | -0.92% | -0.36% | |
| EUR | 0.33% | -0.23% | 0.39% | 0.06% | -0.70% | -0.59% | -0.04% | |
| GBP | 0.55% | 0.23% | 0.62% | 0.29% | -0.48% | -0.37% | 0.19% | |
| JPY | -0.05% | -0.39% | -0.62% | -0.31% | -1.08% | -0.97% | -0.41% | |
| CAD | 0.27% | -0.06% | -0.29% | 0.31% | -0.77% | -0.66% | -0.10% | |
| AUD | 1.03% | 0.70% | 0.48% | 1.08% | 0.77% | 0.11% | 0.67% | |
| NZD | 0.92% | 0.59% | 0.37% | 0.97% | 0.66% | -0.11% | 0.56% | |
| CHF | 0.36% | 0.04% | -0.19% | 0.41% | 0.10% | -0.67% | -0.56% |
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).
The EUR/USD pair is trading near the 1.1820 price zone, up by over 0.30% in the day after the European Central Bank (ECB) announced its monetary policy decision earlier in the week. The Sentix Investor Confidence for February will be released on Monday, and the Eurozone Employment Change on Friday.
GBP/USD is trading near the 1.3610 price region, trimming part of the weekly losses after a dovish hold in the interest rate decision by the Bank of England (BoE). The January BRC Like-For-Like Retail Sales will be released on Monday, and Industrial and Manufacturing Production will be released on Thursday.
USD/JPY is trading near the 157.10 level, climbing to near a two-week high. Japanese General Elections will be on Sunday alongside the release of December Labor Cash Earnings and Current Account NSA.
USD/CAD is trading near the 1.3650 price region, trimming half of its weekly gains. Canada will not have relevant data releases next week.
Gold is trading near $4,960 after the US shutdown was resolved, with geopolitical tensions on standby, the yellow metal struggles to attract buyers.
Anticipating economic perspectives: Voices on the horizon
Sunday 8:
- BoE’s Governor Bailey.
Monday 9:
- ECB’s Lane.
- ECB’s Nagel.
- ECB President Lagarde.
Tuesday 10:
- Fed’s Hammack.
- Fed’s Logan.
Wednesday 11:
- ECB’s Cipollone.
- Fed’s Bowman.
- ECB’s Schnabel.
- Fed’s Hammack.
Thursday 12:
- ECB’s Cipollone.
- ECB’s Lane.
- ECB’s Nagel.
Friday 13:
- Fed’s Logan.
- Fed’s Miran.
- ECB’s De Guindos.
- BoE’s Pill.
Saturday 14:
- ECB’s President Lagarde.
Central banks' meetings and upcoming data releases to shape monetary policies
Tuesday 10:
- US December Retail Sales.
Wednesday 11:
- China January Consumer Price Index (CPI).
- US January Nonfarm Payrolls.
Thursday 12:
- UK flash Gross Domestic Product (GDP) (Q4).
Friday 13:
- RBNZ Inflation Expectations (Q1).
- Swiss January CPI.
- Eurozone flash GDP (Q4).
- US January CPI.
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.
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- CAD rose 0.56% against USD after January employment data showed unemployment falling to 6.5%
- Labor force participation dropped sharply to 65.0%, driving the jobless rate lower despite 25K job losses
- Manufacturing shed 28K positions as US tariffs weigh on the sector, concentrated in Ontario
The Canadian Dollar (CAD) climbed sharply on Friday, adding half a percent against the US Dollar (USD) after January labor market data showed the unemployment rate dropping to 6.5%, its lowest reading since September 2024. The Loonie found support despite headline employment falling by 25,000, as a sharp decline in labor force participation drove the jobless rate lower. USD/CAD pulled back toward 1.3634, trimming gains accumulated over recent weeks.
Labor market details were mixed. The unemployment rate fell three-tenths of a percentage point to 6.5%, but the improvement came primarily from 94,000 people exiting the labor force rather than from job creation. The participation rate dropped four-tenths to 65.0%, its lowest level since early 2025. Full-time work fell by 27,000, concentrated among core-aged women, while manufacturing shed 28,000 positions; a 1.5% decline that marks the sector's continued struggle with US tariff impacts.
Loonie rebounds on USD weakness
The Canadian Dollar's advance owed as much to broad US Dollar softness as to domestic data. The US Dollar Index (DXY) slipped toward 97.9 on Friday, weighed down by concerns over the US labor market and elevated AI valuations. Fresh US data showed job openings unexpectedly fell to 2020 lows, job cuts hit their highest January total since 2009, and initial jobless claims rose to 231K, well above the 212K forecast. The string of weaker labor data pushed markets to price in Federal Reserve (Fed) rate cuts beginning in June.
While the CAD benefited from the Greenback's pullback, Crude Oil prices offered limited tailwinds. West Texas Intermediate (WTI) barrel prices hovered near $62.50 on Friday, extending losses for the week as easing geopolitical tensions around Iran-US nuclear talks and demand concerns pressured the commodity. Oil markets are set to close their first weekly decline in six weeks, with Iran's confirmation of negotiations reducing near-term supply disruption risks.
BoC stays on hold through 2026
The Bank of Canada (BoC) held its policy rate at 2.25% late last month, signaling that it expects to keep rates unchanged through 2026 barring a shift in the outlook. Governor Tiff Macklem noted that while the economy shows resilience, uncertainty around the upcoming Canada-US-Mexico Agreement review keeps risks elevated. With inflation holding near the 2% target and excess labor market slack persisting, the BoC has indicated the current policy stance is appropriate to help the economy through structural transitions tied to US protectionism and slowing population growth.
Daily digest market movers: Mixed labor data drives CAD rebound
- USD/CAD fell 0.56% to 1.3634, trimming losses accumulated since late January.
- Unemployment rate dropped to 6.5%, lowest since September 2024, driven by falling participation.
- Manufacturing employment fell 28K, largely in Ontario, as tariff pressures bite deeper.
- DXY slipped to 97.9 as weaker US labor data reinforced bets on Fed rate cuts starting in June.
- WTI Crude Oil near $62.50, down for the week as Iran-US nuclear talks ease supply concerns.
- BoC holding policy rate at 2.25% through 2026, citing uncertainty around CUSMA review.
Canadian Dollar price forecast
USD/CAD retreated from sixteen-month highs near 1.37 after the January employment report, with the pair now trading at 1.3634. The move pushed price back below recent resistance and into a familiar consolidation zone. The 50-day Exponential Moving Average (EMA) near 1.38 and the 200-day EMA near 1.39 are both above current price action, signaling that the broader uptrend is testing key support levels.
Short-term support builds near 1.36
The recent pullback toward 1.36 brings USD/CAD into a zone that has acted as support multiple times over the past several months. A sustained break below 1.36 would expose the 1.35 handle, where buyers emerged during the Loonie's rally in late January. On the upside, resistance now sits near 1.37, with the 50-day EMA providing an additional barrier to any immediate recovery attempts.
Momentum indicators suggest the near-term bias has shifted
The Relative Strength Index (RSI) pulled back from overbought levels above 70 earlier this week and now hovers in the mid-50s, leaving room for further downside if selling pressure continues. Friday's sharp reversal candle suggests buyers may defend the 1.36 area, but confirmation is needed. A close below 1.3580 would signal that the recent correction has more room to run, while a recovery above 1.3720 would indicate that the broader bullish trend is reasserting itself.
USD/CAD daily chart
Canadian Dollar FAQs
The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar.
The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive.
The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD.
While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar.
Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
DBS Group Research report, authored by Radhika Rao, reports that Moody’s has changed Indonesia’s rating outlook to ‘negative’ from ‘stable’ while affirming the Baa2 rating. The agency cited concerns about reduced predictability in policymaking and increased spending without corresponding revenue generation. The report emphasizes the potential for a downgrade if policy actions do not improve over the next 12-18 months.
Moody’s negative rating outlook
"Moody’s Ratings changed Indonesia’s rating outlook to ‘negative; from ‘stable’ on late Thursday, while affirming the Baa2 rating. The agency expressed far ranging concerns, citing “reduced predictability in policymaking, which risks undermining policy effectiveness and points to weakening governance.”"
"A negative outlook change typically reflects a cautious view on the sovereign, opening the window for follow-up action over the next 12-18 months. Contingent on the course of policy action in this timeframe, the next move might be an eventual downgrade in the rating or a return to the stable outlook."
"In the near-term, onshore financial markets are likely to witness kneejerk weakness due to the outlook change, with much onus on the domestic policy response thereafter. An outlook change doesn’t carry immediate changes in rating-sensitive investment mandates, although there might be lower appetite to build additional exposure, besides a higher preference for shorter-tenor papers."
"We note that the rating agency’s action is policy-driven not cyclical, thus providing the room to take corrective action. A stronger commitment to the -3% of GDP fiscal deficit cap and debt level ceilings will be timely, alongside a roadmap to gradually raise revenue measures to finance welfare plans."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- Gold rebounds from $4,655 daily lows as weaker US labor data pressures the Greenback.
- Rising Fed cut expectations offset firmer Treasury yields, fueling dip-buying demand for bullion.
- Focus shifts to US CPI, Retail Sales and Fed speakers for near-term policy direction.
Gold price (XAU/USD) rallies more than 3% on Friday, poised for a decent weekly gain as dip buyers emerged, following a session that pushed the yellow metal below the $4,800 mark. Worth noting that Friday has been a volatile session, with the non-yielding metal falling to a three-day low of $4,655 before erasing those previous losses. At the time of writing, XAU/USD trades at $4,963.
XAU/USD stages a sharp rebound toward $4,950 as soft US labor data revives Fed easing bets
The non-yielding metal is enjoying a healthy recovery from Thursday. Greenback’s initial weakness on Friday reflected worse-than-expected US labor market data on Thursday, which fueled speculation for further easing by the Federal Reserve (Fed). This prompted traders to buy bullion’s dip even though US Treasury yields began to show signs of life.
The data front was light as January’s Nonfarm Payrolls were delayed for February 11, due to the US government shutdown. Consumer sentiment in the US improved, revealed the University of Michigan (UoM) survey, which should be reviewed with a pinch of salt, as it revealed that “Sentiment surged for consumers with the largest stock portfolios, while it stagnated and remained at dismal levels for consumers without stock holdings,” stated Joanne Hsu, the Survey’s Director.
On the geopolitical front, US-Iran talks began in Omani, with both parties agreeing to continue negotiations. Despite this, it is said that Iran refused to end nuclear enrichment in discussions with the US, as revealed by The Wall Street Journal.
The week ahead will feature the release of US employment situation, Retail Sales and the Consumer Price Index (CPI). Also, traders would be dissecting speeches by a flurry of Federal Reserve officials.
Daily digest market movers: Gold boosted by softer-than-expected US data
- The US Dollar Index (DXY), which measures the buck’s value against a basket of six currencies, loses 0.35% as of writing. The DXY is at 97.49 after failing to clear the 98.00 mark, a tailwind for Gold prices.
- Meanwhile, US Treasury yields ─which usually correlate negatively with Bullion’s value ─ are rising in tandem with XAU. The US 10-year Treasury note is up nearly three basis points at 4.216%.
- San Francisco Fed President Mary Daly said they need to look at both sides of the Fed's mandate. She reiterated that the low-firing, low-hiring could remain for some time, but said that it could quickly shift to no-hiring, more firing amid a scenario of inflation remaining above the Fed’s 2% goal.
- A decline in job openings, a rise in layoffs flagged by the Challenger report, and a jump in Jobless Claims have strengthened expectations that the Federal Reserve will cut interest rates in 2026.
- Meanwhile, the University of Michigan’s February Consumer Sentiment index improved to 57.3 from 56.4, beating forecasts of 55. One-year inflation expectations eased to 3.5% from 4.0%, while five-year expectations edged slightly higher to 3.4% from 3.3%.
- Money markets have priced in 54 basis points of Fed easing by year-end, according to Prime Market Terminal data.
Technical outlook: Gold turns bullish once more, eyes on $5,000
Gold price uptrend remains intact, after it fell below the 20-day Simple Moving Average (SMA) of $4,861. Since testing three-day lows of $4,655, the precious metal has not looked back, seeming poised to challenge $5,000.
Bullish momentum is picking up after the Relative Strength Index (RSI) fell below neutral levels on Tuesday. However, it has recovered and is aiming upward in bullish territory.
Conversely, if Gold price falls below $4,900, it could consolidate within the 20-day SMA of $4,861 and $4,900 ahead of the next week.
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.
UOB's report by Enrico Tanuwidjaja and Sathit Talaengsatya discusses the Bank of Thailand's (BOT) shift from solely using interest rates to a broader policy framework. The BOT aims to address structural economic issues such as low productivity and high inequality while maintaining an accommodative interest rate policy. The report anticipates a final 25bps cut in February 2026, bringing the policy rate to 1.00%, which is expected to be sustained through 2026-27.
BOT's strategic policy adjustments
"FX becomes a more operational domain, not just a communications domain. The BOT has raised concerns about baht appreciation and non-fundamental flows, including gold-linked flows that can at times be large relative to daily FX turnover (e.g., reaching 20% in some periods). The BOT also explicitly highlights the baht’s strength (e.g., about 8% appreciations against USD since early 2025) and its willingness to intervene if moves are too fast, alongside tighter measures on gold-related FX activity."
"In our baseline, we expect the MPC to keep policy accommodative and deliver one final 25bps cut at the 25 Feb 2026 meeting—after the 4Q25/full-year 2025 GDP release (we forecast 2025 growth at 2.0%). This would take the policy rate to 1.00%, which we think is likely to be maintained through 2026–27."
"That said, the BOT is likely to keep interest rate policy accommodative for longer but will be reluctant to entrench a permanently-low-rate regime given repeated emphasis on financial stability and preserving policy space."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
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