Forex News
US President Donald Trump said he cut a diesel export deal with Russia and blocked numerous sanctions because he doesn’t want to drive Vladimir Putin away from peace talks with Ukraine, Bloomberg reported on Sunday.
Meanwhile, Trump accused Ukrainian President Volodymyr Zelenskyy of prolonging the Russia-Ukraine war, now in its fifth year, because of the military aid he has gotten from European allies. Zelensky said that it was unfortunate the US has decided to "completely disregard" the sanctions.
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.
Reserve Bank of Australia (RBA) Assistant Governor Chris Kent said on Monday that reasonable indication neutral rates are increasing domestically and globally, adding that it’s difficult to pinpoint neutral rate amid high uncertainty.
Key quotes
Reasonable indication neutral rates are increasing domestically and globally.
Difficult to pinpoint neutral rate amid high uncertainty.
Tax adjustments on housing move monetary policy in a favorable direction.
Confident policy is somewhat restrictive, question is whether it is restrictive enough.
Household demand softening, but business credit remains strong.
Tax adjustments on housing move monetary policy in a favorable direction.
A bit cautious about monthly job figures, but labor market loosens.
Market reaction after labour data was reasonable.
Market reaction
At press time, the AUD/USD pair trades 0.28% higher at around 0.6965.
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.
- EUR/USD softens to around 1.1215 in Monday’s early Asian session.
- Fears of a debt crisis and intensifying political instability in France weigh on the Euro.
- Fed’s Warsh signaled no urgency to tighten policy further.
The EUR/USD pair faces some selling pressure to near 1.1215 during the early Asian trading hours on Monday. The Euro (EUR) weakens against the US Dollar (USD) amid fiscal risks in France after the French debt risk premium jumped in early October.
The spread between French and German 10-year government bonds surged beyond 150 basis points (bps) in the previous session, signaling heightened investor concerns. This key indicator of financial market risk has reached its highest level since the Eurozone debt crisis in 2011.
Protests in several cities in France descended into clashes between police and demonstrators, sparking some of France’s worst street violence in years, with looting and landmarks set on fire, per Bloomberg. French President Emmanuel Macron said that the country felt anger and shame following widespread violence over the weekend and called for order to be restored.
ECB President Christine Lagarde said during the IMF-World Bank summit in Bangkok that France must solve its own structural problems through domestic fiscal policy. Elsewhere, Spain is also heading to a snap general election on November 29, fueling further political instability across the Eurozone.
Across the pond, Federal Reserve (Fed) Chair Kevin Warsh on Friday offered no clues about future rate decisions, saying he does not "prejudge meetings.” Markets are now pricing in nearly an 83.9% chance that the Fed will keep rates unchanged later this month, up from 49% a month earlier, according to the CME FedWatch Tool.
Nordea sees scope for further ECB hikes and modest upside in longer EUR yields
Analysts at Nordea maintain a constructive view on the ECB’s tightening path, stating that “we continue to expect two further 25bp rate hikes from the ECB, one in December and another in March 2027, taking the deposit rate to 3%.” In their assessment, the policy backdrop and data flow “should be sufficient to deliver another hike when new staff projections become available in December,” with the bank arguing that this environment “supports a pre-emptive December hike if price pressures continue to broaden, while leaving room for the ECB to move more cautiously if core inflation and wages remain contained.”
On the rates side, Nordea notes that “we continue to see modest upside potential for longer EUR yields in the medium term,” but cautions that “this leaves room for a correction lower in the short term, especially if incoming inflation data show only limited broadening or concerns about growth become more prominent.”
Warsh cautious on crisis scars but underscores investment surge and AI focus
Fed Chair Warsh’s speech scores 5.6/10 on the FXS Speechtracker, modestly below the 6.1/10 historical average, signaling a slightly less impactful tone relative to the established baseline despite broadly aligned macro views since the September FOMC. The admission of being “over-scarred from the global financial crisis” points to a structurally cautious bias on financial stability and tail risks, even as Warsh highlights a structural growth backdrop and an investment surge driven by “good policies” and transformative AI developments. Warsh’s refusal to pre-judge the October and December meetings and emphasis on crystallizing data on output, employment, and inflation keeps the Dollar narrative data-dependent rather than pre-committed.
The FXS Fed Sentiment Index was unchanged, moving 0.00 points to a still-elevated level of 127.51, confirming that the overall policy tone remains firmly in hawkish territory despite the slightly softer FXS Speechtracker score. With the index well above the neutral 100 mark, markets are likely to interpret Warsh’s focus on price stability, AI-driven data confidence, and vigilance on negative tailside risks as consistent with a bias toward maintaining restrictive policy settings.
Technical Analysis: EUR/USD keeps a bearish vibe under the 100-day SMA
In the daily chart, EUR/USD trades with a bearish near-term bias, as spot remains capped beneath the 100-day simple moving average (SMA) and the Bollinger middle band. Price holds closer to the Bollinger lower band support than to overhead resistance, while the Relative Strength Index (RSI) at 37.5 sits just below neutral, hinting that recent selling pressure is easing but not yet reversing.
On the topside, initial resistance emerges at the Bollinger middle band near 1.1270, ahead of a stronger barrier at the upper Bollinger band around 1.1440 and the 100-day SMA at 1.1465, which together define a dense supply zone limiting recovery attempts. On the downside, the Bollinger lower band at 1.1100 offers the next key support level, and a decisive break below this floor would likely extend the bearish phase toward lower psychological and historical levels.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro FAQs
The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
A secretary of Iran’s Supreme National Security Council, Mohsen Rezaei, warned on Sunday that Tehran has prepared a new retaliation plan for any renewed US-Israeli attack, as maritime authorities reported several separate attacks on commercial vessels around the Strait of Hormuz, CNBC reported.
“Iran’s armed forces have prepared a response to any new act of adventurism that would be far more devastating than the 12-day and 40-day wars,” said a senior Iranian security official. “Iran’s new operational plan will not follow the rules with which they are familiar,” Rezaei added.
Meanwhile, the UK Maritime Trade Operations (UKMTO) said a tug traveling south northeast of the United Arab Emirates was hit by two unknown projectiles on Sunday. On Saturday, a master of a liquefied natural gas tanker southwest of Yemen reported “being approached by a small skiff with seven persons onboard.
Elsewhere, Saudi Arabia reported another tanker northeast of the Kingdom being hit by a rocket-propelled grenade fired from a small boat on Friday.
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.
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.
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