Forex News
- The Swiss Franc strengthens as market caution and expectations of political gridlock drive safe-haven demand.
- Greenback upside remains limited as US bond yields fall and Fed rate-hike bets are trimmed.
- SNB expected to hold rates steady as Chair Schlegel confirms Swiss inflation pressures stay contained.
USD/CHF remains flat after recovering daily losses, trading around 0.8170 during Asian hours on Friday. The pair has pared its daily losses as the US Dollar (USD) gained support amid widespread market caution. Investors are awaiting the upcoming US Nonfarm Payrolls (NFP) report, which is expected to play a critical role in shaping market expectations for the Federal Reserve's (Fed) December policy decision.
However, the upside of the Greenback could be restrained as US bond yields declined. A Democratic sweep dragged oil prices lower on speculation that the election would speed an end to the Iran war, which also prompted traders to trim bets on US Federal Reserve (Fed) rate hikes. Markets are currently pricing in nearly a 70.9% probability that the Fed will raise rates in December, according to CME’s FedWatch tool. Furthermore, the Democrats' victory has raised expectations of political gridlock in Washington, which could constrain government spending and ultimately lead to slower economic growth.
The Swiss Franc (CHF) strengthened as the Democratic sweep raised expectations for tighter regulation of the AI buildout and lifted safe-haven demand. This outcome could also lead to political gridlock and increase the prospect of fiscal restraint in the US. However, higher safe-haven demand could prompt traders to unwind franc-funded carry trades, which had previously benefited from the widening interest rate differential with the US and weighed heavily on the CHF. Swiss borrowing costs have remained at the world's lowest for over a year, making the franc an attractive funding currency for higher-yielding investments.
Looking ahead, the Swiss National Bank (SNB) is not expected to raise rates in the near term. This stance is further supported by Chair Schlegel’s remarks, which reinforced that Swiss inflationary pressures remain contained. While Swiss inflation rose in October due to higher energy costs and a weaker franc, the currency's subsequent appreciation could help ease imported cost pressures.
Analysts at UOB Group maintain a cautious, negative stance on USD/CHF over the one-to-three-week horizon, noting that the pair has yet to fully confirm a deeper downside extension. They recall that, “tracking our negative USD view from late last week, we highlighted yesterday that USD ‘must break and hold below 0.8140 before further declines can be expected.’ We added, ‘the next level to watch below 0.8140 is 0.8110.’”
While USD/CHF did “break below 0.8140,” it subsequently “rebounded to close at 0.8168 (-0.46%),” meaning the close failed to validate a clean break of the level. Even so, UOB points out that “given the sharp decline to 0.8124, there is a chance for USD to test 0.8110 before the risk of a recovery increases.” On the topside, they stress that “a breach of 0.8205 (‘strong resistance’ was at 0.8220 yesterday) would mean that 0.8110 is not coming into view,” marking 0.8205 as the key barrier that would negate the immediate downside scenario.
Swiss Franc FAQs
The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone.
The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in.
The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF.
Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate.
As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.
- DXY builds on Thursday’s recovery from late September lows amid rebounding US bond yields.
- Oil-driven inflation fears keep Fed hike bets on the table, supporting bond yields and the USD.
- Hopes for an end to the Iran war warrant caution for bulls ahead of the crucial US NFP report.
The US Dollar Index (DXY), which tracks the Greenback against a basket of currencies, gains some follow-through positive traction during the Asian session on Friday, recovering further from its lowest level since late September set the previous day. The index advances to the 101.80 area in the last hour, though it sticks to modest weekly losses as traders look to the crucial US monthly employment details for a fresh impetus.
The popularly known US Nonfarm Payrolls (NFP) report is anticipated to show that the economy added 65K new jobs in October, up from the previous month's softer reading of 29K. Meanwhile, the Unemployment Rate is forecast to hold steady at 4.2%. Apart from this, investors will pay close attention to Average Hourly Earnings, as wage growth pressures could heavily influence Federal Reserve (Fed) policy expectations and drive demand for the US Dollar (USD).
Heading into the key data risk, a sharp overnight recovery in crude oil prices reignited inflationary concerns. Moreover, traders are still pricing in around a 70% chance that the US central bank will raise borrowing costs again in December. This, in turn, triggers a modest bounce in US bond yields following the mid-week slump sparked by the US midterm elections and supports the DXY. Moreover, geopolitical uncertainties back the case for further gains for the safe-haven USD.
President Donald Trump said on Thursday that the US may have to destroy the rest of Iran and added that people will know soon enough if he acts. Moreover, the US and Iran remain divided over Tehran's nuclear program and the Strait of Hormuz. However, top Senate Democrat Chuck Schumer vowed on Wednesday to push for an end to the Iran war, making it prudent to wait for strong follow-through buying before confirming a near-term bottom for the DXY.
DXY 1-hour chart
Technical Analysis
The DXY retains a mildly bullish bias above the 100-hour Exponential Moving Average (EMA) at 101.62. The index has also reclaimed the 38.2% Fibonacci retracement at 101.69, which now reinforces underlying demand. Further up, immediate resistance appears at the 50.0% retracement near 101.84, followed by the 61.8% level at 101.99 and the 78.6% retracement at 102.21 ahead of the recent cycle high area at 102.49.
On the downside, initial support is seen at the reclaimed 38.2% retracement at 101.69, ahead of the 100-period EMA at 101.62, with deeper support at the 23.6% Fibo. level at 101.50 and the structural floor at 101.20.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
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 New Zealand Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.19% | 0.14% | 0.08% | 0.21% | 0.49% | 0.58% | 0.00% | |
| EUR | -0.19% | -0.06% | -0.11% | 0.03% | 0.29% | 0.39% | -0.19% | |
| GBP | -0.14% | 0.06% | -0.04% | 0.08% | 0.35% | 0.45% | -0.13% | |
| JPY | -0.08% | 0.11% | 0.04% | 0.15% | 0.41% | 0.50% | -0.07% | |
| CAD | -0.21% | -0.03% | -0.08% | -0.15% | 0.27% | 0.36% | -0.21% | |
| AUD | -0.49% | -0.29% | -0.35% | -0.41% | -0.27% | 0.09% | -0.48% | |
| NZD | -0.58% | -0.39% | -0.45% | -0.50% | -0.36% | -0.09% | -0.56% | |
| CHF | -0.01% | 0.19% | 0.13% | 0.07% | 0.21% | 0.48% | 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).
- AUD/JPY tumbles to near 108.90 in Friday’s early European session.
- Negative tone of the cross prevails under the 100-day SMA, with bearish RSI momentum.
- The first upside barrier emerges at 109.15; the initial support level is seen at 108.64.
The AUD/JPY cross trades in negative territory around 108.90 during the early European trading hours on Friday. The Japanese Yen (JPY) strengthens against the Australian Dollar (AUD) on safe-haven flows and Bank of Japan (BoJ) rate hike signals.
Fears of tighter scrutiny of the Artificial Intelligence (AI) industry, particularly around data center construction, have unsettled global financial markets this week. The flight to safety boosts the JPY and puts downward pressure on the cross.
Hawkish BoJ Minutes might contribute to the JPY’s upside. According to the minutes of the September meeting released on Thursday, most of BoJ policymakers agreed that further interest rate increases would be appropriate as underlying inflation approached the central bank's 2% target.
One board member indicated that there may be room to accelerate interest rate increases as the central bank assessed the effects of Middle East developments, growing demand linked to Artificial Intelligence (AI), and Foreign Exchange (FX) movements.
BoJ minutes bolster case for gradual tightening path
Analysts at Deutsche Bank note that, in central bank news, the minutes from the BoJ's September meeting "reinforced the case for further policy tightening." They highlight that policymakers "generally agreed that interest rates should continue to rise," with one member "highlighting the possibility of a faster pace of hikes." At the same time, Deutsche Bank points out that another policymaker "noted that while there was no need for immediate action, the BoJ should continue to calibrate policy carefully to prevent excessive and persistent inflationary pressures," underscoring a cautious but clearly tightening bias within the committee.
Technical Analysis: Negative outlook of AUD/JPY remains intact below the 100-day SMA
In the daily chart, AUD/JPY keeps a bearish near-term tone as spot remains decisively capped beneath the 20-day simple moving average (SMA) component of the Bollinger Bands and the 100-day SMA. Price is pressing the lower end of the recent range with the Bollinger lower band acting as immediate overhead supply, while the Relative Strength Index (RSI) at 36.91 hovers just above oversold territory, hinting at persistent downside pressure rather than an imminent bullish reversal.
On the topside, initial resistance level is seen at the lower limit of Bollinger band at 109.15, en route to the 110.00 psychological level and 20-day SMA near 110.40, where stronger selling interest could emerge. Sustained trading above this level could pave the way to the upper boundary of Bollinger band at 111.65 and the 100-day SMA at 111.80.
On the downside, the October 15 low of 108.64 acts as an intial support level for the cross. A drop below the mentioned level would reopen the path toward the February 13 low of 107.70, followed by the January 26 low of 106.08.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Japanese Yen FAQs
The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.
One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen.
Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential.
The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
Gold prices fell in India on Friday, according to data compiled by FXStreet.
The price for Gold stood at 12,272.80 Indian Rupees (INR) per gram, down compared with the INR 12,437.96 it cost on Thursday.
The price for Gold decreased to INR 143,147.50 per tola from INR 145,073.90 per tola a day earlier.
Unit measure | Gold Price in INR |
|---|---|
1 Gram | 12,272.80 |
10 Grams | 122,731.50 |
Tola | 143,147.50 |
Troy Ounce | 381,739.80 |
FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.
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.
(An automation tool was used in creating this post.)
- EUR/JPY may find initial support at the 12-month low of 175.07.
- The 14-day Relative Strength Index is at 45.73, indicating subdued bullish momentum.
- The immediate barrier lies at the nine-day EMA of 176.91.
EUR/JPY loses ground for the second consecutive day, trading around 176.80 during Asian hours on Friday. The technical analysis of the daily chart suggests that the currency cross is remaining within a descending channel pattern, indicating a prevailing bearish bias.
The EUR/JPY cross is keeping a bearish near-term tone as it holds below both the nine- and 50-day Exponential Moving Averages (EMAs). The short- and medium-term EMAs above price suggest rallies remain capped for now, while the 14-day Relative Strength Index (RSI) at 45.73 stays below the neutral 50 line, hinting at subdued bullish momentum rather than outright oversold conditions.
The EUR/JPY cross may fall toward the initial support at the 12-month low of 175.07, reached on October 30, followed by the lower boundary of its descending channel around 174.00. A break below the channel would open the door for the currency cross to navigate the region around the 15-month low at 169.72.
On the upside, the EUR/JPY cross may rebound and test the immediate barrier at the nine-day EMA of 176.91, followed by the upper boundary of the descending channel near the 50-day EMA of 178.59. A successful break above the medium-term price average would cause a bullish reversal, supporting the EUR/JPY cross to explore the area around the all-time high of 187.95, reached on April 17.
Yen still weighed down by structural outflows despite distorted rate signals
Analysts at MUFG/BTMU note that recent official action has complicated the usual relationship between the Yen and interest rate differentials, with “intervention in last July / early August” having “distorted the link with rates.” However, they stress that the underlying message from the currency’s behaviour is clear: “what the movement of the yen does indicate is that there are still some structural flows that continue to weigh on yen performance and those flows could well be slow to change.” This suggests that, even as rate dynamics evolve, persistent portfolio and FDI outflows remain a key drag on JPY, and are unlikely to reverse quickly.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Euro Price Today
The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.18% | 0.12% | -0.02% | 0.20% | 0.54% | 0.58% | -0.01% | |
| EUR | -0.18% | -0.07% | -0.21% | 0.03% | 0.36% | 0.40% | -0.20% | |
| GBP | -0.12% | 0.07% | -0.13% | 0.10% | 0.43% | 0.47% | -0.13% | |
| JPY | 0.02% | 0.21% | 0.13% | 0.23% | 0.57% | 0.60% | 0.00% | |
| CAD | -0.20% | -0.03% | -0.10% | -0.23% | 0.33% | 0.37% | -0.22% | |
| AUD | -0.54% | -0.36% | -0.43% | -0.57% | -0.33% | 0.04% | -0.56% | |
| NZD | -0.58% | -0.40% | -0.47% | -0.60% | -0.37% | -0.04% | -0.58% | |
| CHF | 0.01% | 0.20% | 0.13% | -0.01% | 0.22% | 0.56% | 0.58% |
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 Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
- The RBA raised interest rates to 4.85%, but a split vote signals a potential December pause.
- High Australian inflation persists, but less hawkish central bank guidance continues to weigh on the currency.
- US Dollar gains support from market caution, though falling bond yields and political gridlock limit upside.
AUD/USD remains subdued after registering over 1% losses the previous day, trading around 0.6910 during Asian hours on Friday. The Australian Dollar lost ground against the US Dollar (USD) as expectations for further interest rate hikes were dampened by less hawkish guidance from the Reserve Bank of Australia.
Although Australia’s central bank raised its cash rate by 25 basis points to 4.85% on November 3, the split 6–3 decision, with three policymakers favoring no change, along with the removal of explicit language regarding future tightening, pointed to a possible pause in December. Nevertheless, RBA Deputy Governor Andrew Hauser signaled at the Australian National University in Canberra on Thursday that inflationary pressures remain very high.
Meanwhile, the US Dollar found support in widespread market caution as investors await the upcoming US Nonfarm Payrolls report, which is expected to play a critical role in shaping market expectations for the Federal Reserve's December policy decision.
However, that dollar support was counterbalanced by several opposing factors. Recent declines in US bond yields and lingering hopes for diplomatic progress with Iran continue to keep the safe-haven greenback on the back foot. Furthermore, the Democrats' victory has raised expectations of political gridlock in Washington, which could constrain government spending and ultimately lead to slower economic growth.
USD support seen holding as Fed tightening and institutional guardrails remain in focus
Strategists at OCBC argue that the broader macro backdrop continues to favour the Dollar, noting that “with US growth still solid, inflation sticky and the Fed on track for further tightening, we retain our view that the USD should remain supported, albeit with greater two-way risks.” They add that a Democratic Senate “should also strengthen the institutional guardrails around Fed independence by making it harder for the administration to confirm additional allies to the Federal Reserve Board,” reinforcing their view that policy continuity at the Fed will underpin the currency even as market volatility around the outlook increases.
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.
- NZD/USD weakens to around 0.5585 in Friday’s Asian session.
- The New Zealand jobless rate climbed to 5.7% in Q3, its highest since 2015.
- Democrats sweeping in Congress could push Treasury yields and US Dollar lower.
The NZD/USD pair attracts some sellers to near 0.5585 during the Asian trading hours on Friday. The New Zealand Dollar (NZD) extends its downside against the US Dollar (USD) due to soft employment data and political uncertainty in New Zealand. The US September jobs report will be in the spotlight later in the day.
Data released by Statistics New Zealand earlier this week showed that Unemployment Rate rose to 5.7% in the three months ended September, its highest level in nearly 11 years. This figure followed 5.6% in the previous quarter and was above the market consensus of 5.5%.
Attention will shift to the New Zealand general election on Saturday. Christopher Luxon's center-right National Party-led coalition is facing mounting pressure to demonstrate that its policies can lift growth and ease cost-of-living strains, with a LPSOS poll earlier this week listing inflation and the cost of living as the top concern for voters ahead of an election contest on November 7.
The Democrats win a majority in both the US Senate and House of Representatives on Tuesday, taking control from Republicans. This achieved major victories in several Republican strongholds for the first time in decades, as tens of millions of voters delivered a sharp rebuke to President Donald Trump.
The sweep of Congress by Democrats dragged oil prices lower on speculation the election would speed an end to the Iran war and prompted traders to trim bets on US Federal Reserve (Fed) rate hikes. Markets are now pricing in nearly a 70.9% odds that the Fed will raise rates in December, according to CME’s FedWatch tool.
RBNZ surprise keeps RBA watchers on edge as New Zealand diverges from Australia
Rabobank’s strategists note that “last week’s decision by the RBNZ to leave rates unchanged blindsided a market that was priced for a hike,” and has “led to some soul searching ahead of this week’s RBA decision.” The central bank underscored the mixed backdrop at its policy meeting, commenting that while “annual inflation is expected to increase to 4.4% in the December quarter (largely on the back of fuel),” “domestic demand remains subdued.”
Rabobank contrasts the macro setting across the Tasman, pointing out that “the performance of the New Zealand economy has been very different from that of Australia in recent years, with the former only emerging from recession in late 2024 to an unbalanced performance last year.” They add that “despite some strong green shoots for New Zealand in Q1 2026, this was ahead of the headwinds caused by the Iran war.”
Against that backdrop, Rabobank argues that “the shock of last week’s RBNZ policy decision has underpinned some concerns over the signals that RBA Governor Bullock may provide this week,” with investors wary of another central bank wrong-footing a market positioned for further tightening.
Barkin flags solid demand and sticky inflation, keeping Dollar bulls alert despite sentiment pullback
Barkin’s speech scores 6/10 on the FXS Speechtracker, essentially in line with the 6.1/10 historical average, signaling a steady, moderately hawkish tone. The emphasis on solid demand, strong earnings, broad-based cost pressures and the need to pass these along, alongside the view that inflation is unlikely to either accelerate or fall, underscores a bias toward maintaining at least neutral-to-restrictive policy, with “gradual makes sense” framing the pace rather than the direction. Comments that AI-driven demand and AI buildout are adding near-term inflationary pressure, while inflation remains the most important risk, reinforce a backdrop where the Dollar is supported by expectations of sustained policy firmness even if the policy rate is described as “somewhere around neutral.”
The FXS Fed Sentiment Index slipped by 0.31 points to 144.92, indicating a modest pullback in perceived hawkishness but still firmly in hawkish territory. Despite the slight decline, the combination of solid demand, sticky inflation and AI-related cost pressures means the FXS Fed Sentiment Index level well above 100 continues to signal a policy stance that should underpin the Dollar, even as markets fine-tune expectations around the pace rather than the direction of future moves.
Technical Analysis: NZD/USD keeps a bearish tone below the 100-day SMA
In the daily chart, NZD/USD maintains a bearish near-term bias as spot holds beneath the 100-day simple moving average (SMA) and the Bollinger Bands’ 20-period middle SMA. Price is hovering just above the lower Bollinger Band support, underscoring persistent downside pressure, while the Relative Strength Index (RSI) at 36 shows only a modest recovery from oversold territory, hinting that selling momentum is easing but not yet reversing.
On the topside, initial resistance emerges at the Bollinger 20-period middle SMA around 0.5640, followed by the upper Bollinger Band at 0.5715 before the more substantial hurdle at the 100-day SMA near 0.5755, where stronger supply could cap rebounds. On the downside, the lower Bollinger Band at 0.5565 offers immediate support; a decisive break beneath this floor would likely open the door to further losses, while holding above it keeps the pair in a weakly consolidative phase within the broader bearish structure.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
New Zealand Dollar FAQs
The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD.
The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair.
Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate.
The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
- Silver reverses an Asian session slide, stalling the overnight pullback from a one-week high.
- The intraday recovery lacks follow-through as traders seem hesitant ahead of the US NFP.
- The mixed technical setup further warrants some caution before placing directional bets.
Silver (XAG/USD) attracts some buyers near the $51.25 region during the Asian session on Friday, stalling the previous day's retracement slide from the vicinity of mid-$53.00s, or a one-week high. The white metal retakes the $52.00 mark in the last hour, though the upside seems limited as traders await the release of the crucial US Nonfarm Payrolls (NFP) report before placing directional bets.
From a technical perspective, XAG/USD showed some resilience below the $51.70-$51.65 confluence – comprising the 100-hour Exponential Moving Average (EMA) and the 50% Fibonacci retracement level of the recent downswing from late October. The said area offers immediate underlying support and hints at ongoing consolidation rather than a decisive trend amid mixed momentum indicators.
In fact, the Relative Strength Index (RSI) is near 46, and the Moving Average Convergence Divergence (MACD) is below zero, suggesting that bullish pressure has faded but sellers lack clear dominance for now. Hence, any subsequent move up could face initial resistance at the 61.8% Fibo. retracement at $52.34, ahead of a higher barrier at the 78.6% retracement near $53.35 and the recent cycle high of $54.64.
On the downside, a close back below the clustered support formed by the 100-period EMA and the 50.0% retracement, around the $51.70-$51.65 region, would expose the 38.2% level at $50.92, with deeper bearish pressure likely bringing the 23.6% retracement at $50.04 into view.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
XAG/USD 1-hour chart
Silver FAQs
Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets.
Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices.
Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices.
Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
- USD/JPY attracts some buyers during the Asian session, though the upside seems limited.
- The recent slump in US bond yields and Iran diplomacy hopes act as a headwind for the USD.
- A hawkish BoJ might support the JPY and cap spot prices ahead of the crucial US NFP report.
The USD/JPY pair stages a modest recovery from the 157.25 area, or fresh weekly touched during the Asian session on Friday, and climbs to the 158.00 neighborhood in the last hour. Spot prices now seem to have snapped a two-day losing streak, though the upside seems capped as traders might opt to wait for the release of the crucial US monthly employment details before placing fresh directional bets.
The popularly known US Nonfarm Payrolls (NFP) report will play a key role in influencing market expectations about the US Federal Reserve's (Fed) policy path, which in turn will drive US Dollar (USD) demand. Heading into the key data risk, some repositioning trade turns out to be a key factor behind the USD/JPY pair's intraday rebound, though the fundamental backdrop warrants some caution before placing aggressive bullish bets amid subdued US Dollar (USD) price action.
A decisive Democratic sweep in the US midterm elections lowered expectations that US President Donald Trump will resume military strikes against ? Iran, triggering a steep decline in crude oil prices and easing inflationary concerns. This forced traders to trim their bets for a Fed hike in December. Adding to this, a bruising rout on Wall Street forced investors to take refuge in safe-haven assets and dragged US bond yields to a near two-month low, capping the upside for the USD.
The Japanese Yen (JPY), on the other hand, might continue to draw support from hawkish Bank of Japan (BoJ) expectations. In fact, minutes of the September BoJ meeting showed on Thursday that policymakers concurred it was appropriate to keep increasing the policy interest rate and modify the level of monetary easing. This reaffirms market bets for an interest rate hike in December, which favors JPY bulls and might keep a lid on any meaningful recovery for the USD/JPY pair.
USD/JPY daily chart
Technical Analysis
The USD/JPY pair maintains a mildly bearish near-term tone beneath the 200-day Simple Moving Average (SMA) at 158.66, suggesting that rallies are likely to face selling interest while the broader structure remains below this key average. Bulls would need to reclaim the said barrier to ease downside pressure and open the door for a more constructive bias.
On the downside, the daily swing low, around 157.25, could lend some support ahead of the 157.00 mark and the lower boundary of a short-term trading range, around the 156.60-156.50 region. A convincing break below will be seen as a fresh trigger for bearish traders and turn the USD/JPY pair vulnerable to decline further.
(The technical analysis of this story was written with the help of an AI tool. Know more.)
Nonfarm Payrolls FAQs
Nonfarm Payrolls (NFP) are part of the US Bureau of Labor Statistics monthly jobs report. The Nonfarm Payrolls component specifically measures the change in the number of people employed in the US during the previous month, excluding the farming industry.
The Nonfarm Payrolls figure can influence the decisions of the Federal Reserve by providing a measure of how successfully the Fed is meeting its mandate of fostering full employment and 2% inflation. A relatively high NFP figure means more people are in employment, earning more money and therefore probably spending more. A relatively low Nonfarm Payrolls’ result, on the either hand, could mean people are struggling to find work. The Fed will typically raise interest rates to combat high inflation triggered by low unemployment, and lower them to stimulate a stagnant labor market.
Nonfarm Payrolls generally have a positive correlation with the US Dollar. This means when payrolls’ figures come out higher-than-expected the USD tends to rally and vice versa when they are lower. NFPs influence the US Dollar by virtue of their impact on inflation, monetary policy expectations and interest rates. A higher NFP usually means the Federal Reserve will be more tight in its monetary policy, supporting the USD.
Nonfarm Payrolls are generally negatively-correlated with the price of Gold. This means a higher-than-expected payrolls’ figure will have a depressing effect on the Gold price and vice versa. Higher NFP generally has a positive effect on the value of the USD, and like most major commodities Gold is priced in US Dollars. If the USD gains in value, therefore, it requires less Dollars to buy an ounce of Gold. Also, higher interest rates (typically helped higher NFPs) also lessen the attractiveness of Gold as an investment compared to staying in cash, where the money will at least earn interest.
Nonfarm Payrolls is only one component within a bigger jobs report and it can be overshadowed by the other components. At times, when NFP come out higher-than-forecast, but the Average Weekly Earnings is lower than expected, the market has ignored the potentially inflationary effect of the headline result and interpreted the fall in earnings as deflationary. The Participation Rate and the Average Weekly Hours components can also influence the market reaction, but only in seldom events like the “Great Resignation” or the Global Financial Crisis.
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