Forex News
ING strategists Warren Patterson and Ewa Manthey highlight that Chinese unwrought Aluminium and product exports rose strongly in May to the highest level since November 2024, helped by overseas demand after Middle East disruptions. They also note that CFTC (Commodity Futures Trading Commission) data show an increase in net long Aluminium positions, driven by declines in both longs and shorts.
China exports and CFTC data
"On the export side, shipments of unwrought aluminium and products rose 15.5% YoY to 632.4kt."
"This is the highest since November 2024, as producers responded to stronger overseas demand following supply disruptions from the Middle East."
"Aluminium net longs rose by 4,874 lots to 85,964, driven by a sharper drop in both long and short positions."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- The Oil price bounces back strongly to near $88 as US President Trump warns of escalating military strikes against Iran.
- Trump has stated that Iran’s military is dead and Tehran has no other alternative than negotiations.
- US CENTCOM attacked Iranian targets in retaliation for the downing of the US Apache helicopter.
The West Texas Intermediate (WTI), futures on NYMEX, turns flat slightly above $88.00 in the European trade on Wednesday after clawing back its early losses. The Oil price has rebounded strongly from the day’s low of around $86.14, as United States (US) President Donald Trump has warned of escalating military operations against Iran, through a post on Truth Social, for taking significant time in reaching a peace deal.
Trump stated through his post that Iran’s military capabilities, including Navy and Air Force, have been demolished and they have no other option than to negotiate with Washington.
“Iran’s Military is a complete and total mess. Much of it, like their Navy and Air Force, doesn’t even exist anymore - They have been completely defeated. Iran is all talk and no action. The Bully of the Middle East is DEAD!!! They’ve taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!”, US President Trump wrote.
With fears of re-escalating the Middle East crisis, concerns regarding the prolonged closure of the Strait of Hormuz, a vital passage to almost one-fifth of the global energy supply, have also increased, resulting in a strong recovery in the oil price.
Trump’s message seems to be more a response to Iran's Foreign Ministry spokesperson Esmaeil Baghaei statement – it came earlier in the day – which stated that Tehran needs to re-assess the terms of negotiations with Washington following overnight clashes.
On late Tuesday, the US Central Command (CENTCOM) confirmed launching a series of attacks on Iran’s air defense, ground control stations, and surveillance radar sites near the Hormuz. The military attack from the US CENTCOM was already anticipated as President Donald Trump on Truth Social vowed retaliation against Iran for shooting down the Apache helicopter over the Hormuz.
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.
Commerzbank’s Volkmar Baur notes that stronger-than-expected South African GDP growth masks weak underlying domestic demand, with consumption and private investment soft while government spending dominates. He warns that higher energy import prices, lower precious metal export prices and uncertainty from the Iran conflict could hurt trade and sentiment, posing downside risks for the South African economy and the Rand.
External shocks threaten fragile demand
"Figures on South African GDP growth released yesterday showed that the economy grew slightly faster in the first quarter than most analysts had expected, according to a Bloomberg survey. However, the details were less encouraging."
"On the positive side, rising exports and falling imports led to a significantly positive trade balance, and inventory changes had a negative impact on growth. As the latter typically evens out over time, the negative inventory contribution should not be negative in the long term and might even revert to growth."
"Less encouraging, however, was that domestic demand from consumption and investment was driven almost exclusively by the government. Private consumption grew by a mere 0.1% in the first quarter - virtually flat - and private investment, after two strong quarters, declined significantly again in the first quarter of 2026."
"This does not bode well for the second quarter. Due to the Iran conflict, foreign trade is likely to come under pressure, as import prices for energy have risen sharply, while precious metal prices - which are an important export good - have fallen."
"At the same time, the uncertainty surrounding the conflict is likely to have weighed on both consumer and investment sentiment. For the South African economy and the rand, the end of the Iran conflict therefore cannot come soon enough."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- The USD/JPY rallies to fresh highs at the 160.50 area, deep within intervention territory.
- News of the hospitalization of BoJ Governor Ueda has increased bearish pressure on the Yen.
- The Japanese central bank is expected to hike its benchmark interest rate by 25 basis points on June 16.
The Japanese Yen (JPY) extends its decline on Wednesday, threading further beyond the key 160.00 per US Dollar (USD), which is considered a red zone for Tokyo intervention. The USD/JPY pair has reached session highs, above 160.50, following news that the Bank of Japan Governor, Kazuho Ueda, has been hospitalized.
A recent BoJ statement announced the news, without further information about Ueda’s illness. The statement, however, affirms that the central bank’s governor will miss the June 15-16 monetary policy meeting and will be replaced by the Deputy Governor, Ryozo Himino, while Deputy Shinichi Uchida will hold the press conference following the decision.
A BoJ rate hike is already priced in
The BoJ is widely expected to tighten interest rates by a quarter of a percentage point next week, setting its benchmark rate at 1%, its highest level in more than 30 years. Investors, however, will be more interested in the press release, looking for hints of a firmer commitment to monetary tightening amid overall Yen weakness.
Japanese authorities allegedly spent JPY 11.7 trillion, about USD 73.14 billion, on April 30 to shore up an ailing Yen, but only for short-term relief. Concerns about the Japanese economy’s exposure to high Oil prices and, above all, the comparatively low Japanese Government Bond (JGB) yields, as markets ramp up bets on Federal Reserve (Fed) rate hikes, have crushed the Japanese currency.
Later on Wednesday, the US Consumer Price Index (CPI) figures for May are likely to endorse those views as consumer inflation is expected to have accelerated to a three-year high. Higher inflation levels, coupled with the strong labour figures released last week, will add pressure to the Fed to tighten its monetary policy, even with the dovish Kevin Warsh as Chairman. In that case, US Treasury yields are likely to jump higher, bringing the US Dollar up with them.
Economic Indicator
Consumer Price Index (YoY)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Wed Jun 10, 2026 12:30
Frequency: Monthly
Consensus: 4.2%
Previous: 3.8%
Source: US Bureau of Labor Statistics
The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
Economic Indicator
Consumer Price Index ex Food & Energy (YoY)
Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as the Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier. The CPI Ex Food & Energy excludes the so-called more volatile food and energy components to give a more accurate measurement of price pressures. Generally speaking, a high reading is bullish for the US Dollar (USD), while a low reading is seen as bearish.
Read more.Next release: Wed Jun 10, 2026 12:30
Frequency: Monthly
Consensus: 2.9%
Previous: 2.8%
Source: US Bureau of Labor Statistics
The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
United States (US) President Donald Trump has stated in an interview with Fox News that he is close to ordering new military strikes against Iranian power plants and bridges, adding that Tehran is "taking too long to make a deal".
Earlier, US President Trump also warned of escalating military operations against Iran, through a post on Truth Social, citing that Tehran has taken significant time in negotiating a peace deal.
“Iran’s Military is a complete and total mess. Much of it, like their Navy and Air Force, doesn’t even exist anymore - They have been completely defeated. Iran is all talk and no action. The Bully of the Middle East is DEAD!!! They’ve taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!” US President Trump wrote.
Market reaction
Military warning from US President Trump against Iran has resulted in a strong recovery in oil prices. As of writing, the WTI Oil price turns flat at around $88.50 after bouncing back strongly from the day's low, slightly above $86.00.
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.
BNY’s Bob Savage highlights a sharp reversal in Canadian Dollar (CAD) flows ahead of the June Bank of Canada (BoC) decision versus April, when CAD was generally bid. He links weaker CAD interest to softer real and nominal rates, expectations that the BoC will be among the most dovish G10 central banks, and shifting Fed pricing that is altering hedging preferences across the Americas.
Flows shift as policy expectations change
"The CAD has fully reversed its flow situation heading into the June decision compared to April, when flows were generally bid."
"With the BOC expected to be among the most dovish in G10, the lack of interest is understandable."
"We may even have to wait for the Fed decision next week before a clearer flow picture emerges."
"Surprisingly, cross-border investors have been more willing to capture CAD exposures compared to CAD-denominated accounts."
"Measured against underlying asset flows, it’s hard to also attribute these flows to asset liquidation, so there could be a fundamental aspect back in play, especially with holdings levels remaining favorable on top of good valuations."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Brown Brothers Harriman’s (BBH) Elias Haddad notes that the US Dollar retains upside risk as US inflation is expected to heat up in May and the disinflation trend has stalled. Fed funds futures fully price a 25 bps hike by year-end, with nearly 50 bps of tightening over twelve months, as markets focus on May CPI data.
USD supported by firmer inflation outlook
"USD can continue to edge higher as the US macro backdrop of improving labor demand and sticky inflation back a more restrictive Fed policy stance. Fed funds futures fully price in a 25bps rate hike to a target range of 3.75-4.00% by year-end and nearly 50bps of tightening in the next twelve months."
"US May CPI takes the data spotlight today (1:30pm London, 8:30am New York). Headline CPI is expected to rise 0.5% m/m vs. 0.6% in April to be up 4.2% y/y (the most since April 2023) vs. 3.8% in April on higher gasoline prices. Core CPI is seen at 0.3% m/m vs. 0.4% in April or 2.9% y/y vs. 2.8% in April."
"Overall, the US disinflation trend has clearly stalled even when looking at CPI measures which filter out extreme price swings, like trimmed mean, median, sticky, and super core."
"Markets largely shrugged off renewed US-Iran strikes. Crude oil prices are consolidating near recent lows, and bond yields are only marginally higher. USD is mixed, underperforming mostly versus NOK and outperforming largely against AUD, ZAR, SEK, and NZD."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
TD Securities’ Robert Both updates Canada’s macro outlook as higher Oil prices push WTI above $95 through Q4, lifting headline CPI to an average 2.9% over Q2/Q3. Despite a weaker 2026 GDP growth path and a delayed output gap closure to 2028, the Bank of Canada is still expected to keep its Overnight Rate at 2.25% through 2027.
Higher Oil complicates Bank of Canada path
"Recent changes to our baseline view for crude oil have introduced upside risk to headline inflation, with WTI prices now projected to hold above $95 through Q4."
"CPI had been softer than expected over Mar/Apr (0.5pp over two months), but the new trajectory for oil threatens to walk some of that back."
"We now look for y/y headline CPI to average 2.9% over Q2/Q3, peaking at 3.0% on a monthly basis."
"Separately, the large miss on Q1 GDP leaves 2026 growth on a much softer trajectory (0.7% on average annual basis) even with a return to above-trend growth in Q2."
"Further accumulation of excess supply gives the Bank of Canada more flexibility to look through the oil shock, but as long as near-term growth is forecast to exceed potential output we do not see a need for cuts."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- Gold price plummets to near $4,170 due to renewed Middle East tensions.
- Iran’s Foreign Ministry spokesperson Baghaei said that Tehran needs to reassess the terms of negotiations with the US.
- Investors keenly await the US CPI data for May.
Gold price (XAU/USD) trades 2.1% lower at around $4,170 during the European trading session on Wednesday. The precious metal faces intense selling pressure as Iran has announced that negotiation terms with the United States (US) towards a permanent peace deal have returned under review, following attacks by Washington’s Central Command (CENTCOM).
Earlier in the day, Iran's Foreign Ministry spokesperson Esmaeil Baghaei said that Tehran needs to reassess the terms of negotiations with Washington following overnight clashes, adding that the US has harmed the diplomatic process with its continued ceasefire violations.
On late Tuesday, the US CENTCOM confirmed launching a series of attacks on Iran’s air defense, ground control stations, and surveillance radar sites near the Strait of Hormuz, a vital passage to almost 20% of global energy supply. These attacks were highly anticipated as US President Donald Trump vowed to retaliate against Tehran’s attack on the US Apache helicopter over the Hormuz.
The message from Iran pushing peace talks with the US under review again has prompted fears of a prolonged closure of the Hormuz, a scenario that will keep oil prices elevated, which will result in de-anchored inflation expectations and hawkish guidance from global central banks.
Signs of tightening monetary conditions or higher for longer interest rates bode poorly for non-yielding assets, such as Gold.
To get fresh cues regarding the current status of the US inflation, investors await the Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.
Gold technical analysis
XAU/USD trades lower at $4,172, extending a bearish phase with spot holding well below the 20-day Exponential Moving Average (EMA) at $4,449.
The distance to this short-term trend gauge reinforces a downside bias, while the 14-day Relative Strength Index (RSI) around 27 sits in oversold territory, hinting that selling pressure is stretched but not yet reversed.
On the topside, the 20-day EMA at $4,449 is the first meaningful resistance that bulls would need to reclaim to ease immediate downside pressure and signal a more sustained recovery attempt. Looking down, the six-month low of around $4,100 is the immediate support. The Gold price would be exposed to $4,000 if it fails to hold $4,100.
(The technical analysis of this story was written with the help of an AI tool.)
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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