Forex News
UOB's report, authored by Quek Ser Leang and Lee Sue Ann, suggests that the EUR/USD is facing downside risks, with potential support levels highlighted. The report indicates that a break below 1.1750 could occur, although a significant drop to 1.1725 is deemed unlikely at this time. The overall sentiment remains bearish for the Euro against the Dollar.
EUR/USD downside risk outlook
"Risk for EUR is tilted to the downside; a break below 1.1750 is not ruled out, but 1.1725 is likely out of reach for now."
"While EUR has not been able to make much headway on the downside since then, we will continue to hold the same view as long as 1.1860 ('strong resistance' level was at 1.1875 yesterday) is not breached."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- GBP/USD rebounded from support near 1.3520 at the channel base, followed by the 50-day EMA.
- The 14-day Relative Strength Index holds at 50 signals neutral momentum.
- The initial resistance lies at the nine-day EMA of 1.3626.
GBP/USD rebounds after two days of gains, trading around 1.3560 during the Asian hours on Friday. The technical analysis of the daily chart points to a potential bearish reversal as the pair is positioned near the lower boundary of an ascending channel pattern.
The 14-day Relative Strength Index (RSI), a momentum indicator, at 50 is neutral. RSI hovering around the midline would turn more supportive on a move above 50 and weaken below it.
The GBP/USD pair holds above the rising 50-day Exponential Moving Average (EMA) at 1.3496, while capped by the nine-day EMA at 1.3626. The short-term average is rolling over, restraining upside as the medium-term slope stays positive. The moving average structure keeps the broader tone supported, yet near-term traction is fading and favors consolidation before direction resumes.
The immediate support is seen at the lower boundary of the ascending channel around 1.3520, followed by the 50-day EMA at 1.3496. A break beneath the longer average would strengthen the bearish bias and put downward pressure on the GBP/USD pair to test the support reversal zone around 1.3350.
On the upside, the GBP/USD pair may target the nine-day EMA of 1.3626. A daily close above the short-term average could unlock a move toward resistance at 1.3869, the highest since September 2021, reached on January 27. Further advances would support the pair to test the upper boundary of the ascending channel around 1.4050. A break above the channel could open a fresh leg higher toward 1.4248, the highest since April 2018.
(The technical analysis of this story was written with the help of an AI tool.)
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.14% | -0.21% | -0.20% | -0.03% | -0.11% | -0.22% | -0.22% | |
| EUR | 0.14% | -0.07% | -0.07% | 0.10% | 0.03% | -0.08% | -0.07% | |
| GBP | 0.21% | 0.07% | 0.00% | 0.19% | 0.10% | -0.01% | -0.01% | |
| JPY | 0.20% | 0.07% | 0.00% | 0.18% | 0.10% | -0.01% | 0.00% | |
| CAD | 0.03% | -0.10% | -0.19% | -0.18% | -0.08% | -0.19% | -0.17% | |
| AUD | 0.11% | -0.03% | -0.10% | -0.10% | 0.08% | -0.11% | -0.11% | |
| NZD | 0.22% | 0.08% | 0.01% | 0.01% | 0.19% | 0.11% | 0.00% | |
| CHF | 0.22% | 0.07% | 0.00% | 0.00% | 0.17% | 0.11% | -0.00% |
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 British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Bank of Japan (BoJ) policy board member Kazuyuki Masu said on Friday that central bank is not behind the curve in dealing with inflation. Masu further stated that BoJ shouldn't raise rates too quickly in a way that derails Japan's economic recovery.
Key quotes
BoJ is not behind the curve in dealing with inflation.
Not thinking of particular pace of rate hike.
It's obvious BoJ shouldn't raise rates too quickly in a way that derails Japan's economic recovery.
I'm not saying that food prices are rising in a way that needs immediate policy action.
Don't have specific timeframe in mind on how soon boj should raise rates to levels deemed neutral to economy,
BoJ should scrutinise economic developments and guide policy in an appropriate way so that underlying inflation moves around 2%.
It would be wrong to have preset idea in mind on how soon to raise rates.
If there is sufficient data that convinces us we should act, then we should act without hesitation.
Market reaction
As of writing, the USD/JPY pair is down 0.21% on the day at 156.70.
Bank of Japan FAQs
The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%.
The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance.
The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance.
A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
- USD/CHF drops to near 0.7765 as the US Dollar corrects amid increase in dovish Fed expectations.
- Weak US job data has prompted expectations of Fed interest rate cuts in March.
- The SNB is unlikely to make any monetary policy adjustment in the near term.
The USD/CHF pair trades 0.22% lower to near 0.7765 during the late Asian trading session on Friday. The Swiss Franc pair is under pressure as the rally in the US Dollar (USD) has paused, following an increase in dovish Federal Reserve (Fed) expectations.
During the press time, the US Dollar Index (DXY), which gauges the Greenback’s value against six major peers, is down 0.2% to near 97.75.
According to the CME FedWatch tool, the possibility of the Fed reducing interest rates by 25 basis points (bps) to 3.25%-3.50% in the March meeting has improved to 22.7% from 9.4% seen on Wednesday.
Trades raise dovish Fed bets as latest United States (US) job market-related data showed signs of continued slowdown in the labor demand. On Thursday, the US JOLTS Job Openings data for December showed that US employers posted 6.542 million fresh job vacancies, significantly lower than estimates of 7.2 million and the previous reading of 6.928 million.
Meanwhile, the ADP reported on Wednesday that the private sector hired 22K fresh workers in January, fewer than 37K in December.
In the Swiss region, investors seek fresh cues on the Swiss National Bank’s (SNB) monetary policy outlook. The SNB is likely to hold interest rates at 0% in the near term as they remain concerned over soft inflationary pressures. Earlier this week, SNB Chairman Martin Schelegl said, “My greatest concern is of course inflation and price stability, and we [SNB] do everything we can to ensure that,” Reuters reported.
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
- GBP/JPY reverses a modest Asian session dip as a modest USD weakness benefits the GBP.
- Expectations of a BoJ rate hike and risk aversion support the JPY, potentially capping the cross.
- The divergent BoE-BoJ policy outlooks also warrant caution for aggressive bullish traders.
The GBP/JPY cross attracts some buyers near the 211.60 area, or a four-day low touched during the Asian session on Friday, and climbs to the top end of the intraday range. Spot prices currently trade just below mid-212.00s, and, for now, seem to have stalled this week's modest pullback from the 215.00 mark, or the highest level since July 2008.
As investors digest the Bank of England's (BoE) policy update on Thursday, the British Pound (GBP) benefits from the emergence of some US Dollar (USD) selling and turns out to be a key factor acting as a tailwind for the GBP/JPY cross. However, the BoE's dovish outlook might hold back the GBP bulls from placing aggressive bets and cap the upside for the currency pair amid a broadly firmer Japanese Yen (JPY).
The BoE signaled a future cut if inflation continued to slow following the 5-4 MPC vote split decision to leave rates unchanged at the end of the February policy meeting. Moreover, BoE Governor Andrew Bailey, addressing reporters during the post-meeting press conference, said that inflation is set to reach the target level sooner than expected. Traders are now pricing in a 50 basis points (bps) rate cut by the BoE this year.
This marks a significant divergence in comparison to the growing acceptance that the Bank of Japan (BoJ) will stick to its policy normalization path. Data released earlier today showed Japan’s Household Spending fell sharply in December, underscoring the drag from higher prices on consumer activity and reinforcing bets for an early BoJ rate hike. This provides a modest boost to the JPY and might cap the GBP/JPY cross.
Furthermore, the possibility of a coordinated Japan-US intervention supports the JPY. That said, concerns over Japan's fiscal situation and political uncertainty might cap the JPY ahead of the snap lower house election on February 8. Nevertheless, the GBP/JPY cross remains on track to register modest weekly gains, though the mixed fundamental backdrop warrants some caution for aggressive bullish traders.
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Canadian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.15% | -0.19% | -0.27% | -0.02% | -0.08% | -0.19% | -0.23% | |
| EUR | 0.15% | -0.03% | -0.13% | 0.13% | 0.08% | -0.03% | -0.07% | |
| GBP | 0.19% | 0.03% | -0.08% | 0.17% | 0.11% | 0.00% | -0.04% | |
| JPY | 0.27% | 0.13% | 0.08% | 0.27% | 0.20% | 0.09% | 0.06% | |
| CAD | 0.02% | -0.13% | -0.17% | -0.27% | -0.07% | -0.18% | -0.20% | |
| AUD | 0.08% | -0.08% | -0.11% | -0.20% | 0.07% | -0.11% | -0.14% | |
| NZD | 0.19% | 0.03% | -0.00% | -0.09% | 0.18% | 0.11% | -0.04% | |
| CHF | 0.23% | 0.07% | 0.04% | -0.06% | 0.20% | 0.14% | 0.04% |
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).
- EUR/CAD edges higher to near 1.6160 in Friday’s early European session.
- The ECB left policy rates unchanged at its first meeting of 2026.
- Further consolidation cannot be ruled out amid neutral RSI momentum.
- The first upside barrier to watch is 1.6173; the initial support level emerges at 1.6150.
The EUR/CAD cross gathers strength to around 1.6160 during the early European session on Friday. The Euro (EUR) edges higher against the Canadian Dollar (CAD) amid the differing approaches between the European Central Bank (ECB) and the Bank of Canada (BoC). Traders brace for the release of the Canadian employment report for January, which is due later on Friday.
The ECB on Thursday decided to keep the policy rates unchanged for the fifth consecutive meeting, with its key interest rate at 2.0%. During the press conference, ECB President Christine Lagarde said that the central bank would maintain its data-dependent and “meeting-by-meeting approach” and would not be “precommitting to a particular rate path.”
The Canadian central bank held its target for the overnight rate at 2.25% last week, but it warned to respond should the outlook change. “With heightened uncertainty, we are monitoring risks closely,” said BoC Governor Tiff Macklem. Markets anticipate the BoC may still have room for further rate reductions this year due to loosening labor market conditions and slowing inflation. This, in turn, could weigh on the Loonie and act as a tailwind for the cross.
Technical Analysis:
In the daily chart, EUR/CAD holds marginally above the 100-EMA at 1.6150, which has flattened after a mild uptick. The 20-period average embedded in the Bollinger Bands at 1.6173 caps the immediate rebound, maintaining a tight, sideways bias. Bollinger Bands drift lower with contained width as spot trades under the midline; a daily close above that average could open the path toward the upper band at 1.6283.
RSI at 48.97 is neutral, stabilizing after prior soft readings. Failure to reclaim the mid-band would keep pressure toward the lower Bollinger Band at 1.6064, with the 100-EMA acting as initial support; a decisive move back above the midline would improve momentum and shift focus to overhead band resistance.
(The technical analysis of this story was written with the help of an AI tool.)
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.
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