Forex News
UOB economists Enrico Tanuwidjaja and Sathit Talaengsatya note that the Thai Baht’s rally paused in January as a sharp Gold correction disrupted retail Gold markets and generated two-way FX flows. The Bank of Thailand continues to smooth volatility and scrutinize Gold-linked FX. UOB expects broad Dollar softness and a 25 bps BOT cut to keep USD/THB biased lower, but with a moderated pace of Baht appreciation.
Baht strength seen resuming at slower pace
"On the USD/THB exchange rate, our house view is that the baht’s rally paused in Jan as a historically large correction in gold prices disrupted Thailand’s retail gold market, triggering sizeable two-way FX flows through gold shops and pawn brokers, among others."
"After an 8.2% largely one-directional THB appreciation in 2025 — driven mainly by the currency’s tight linkage with record-high gold prices — this consolidation should be welcomed by policymakers and exporters and is consistent with the BOT’s stated preference for a weaker baht that better reflects Thailand’s underlying fundamentals."
"The BOT has continued to smooth excessive volatility through FX operations while tightening scrutiny of gold-linked FX transactions and online gold-trading platforms The central bank has reiterated that it retains sufficient policy flexibility to manage THB movements despite Thailand’s inclusion on the U.S. Treasury’s currency monitoring list."
"Looking ahead, broad USD softness should keep USD/THB biased lower, but the recent gold-market correction, reinforced administrative measures, and our expectation of an additional 25bps BOT rate cut in 1Q26, should moderate the pace of further THB strength; our USD/THB forecasts are: 31.4 (1Q26), 31.2 (2Q26), and 31.0 (3Q26 and 4Q26)."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Here is what you need to know on Friday, February 20:
The number of United States (US) citizens submitting new unemployment insurance applications decreased to 206K, much lower than initial estimates of 225K, and down from the previous week’s revised 229K, according to the US Department of Labor.
Focus now turns to US data released on Friday, including the Core Personal Consumption Expenditures (PCE) Price Index, the advance estimate for fourth-quarter US Gross Domestic Product (GDP), and preliminary February Purchasing Managers Index (PMI) data.
The US Dollar Index (DXY) trades near a four-week high of 97.90, underpinned by stronger-than-expected results from the weekly US labour market data. Investors keep digesting Wednesday’s release of the FOMC Minutes, which showed a still pretty divided Committee.
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 Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.17% | 0.36% | 0.16% | 0.05% | -0.06% | 0.00% | 0.37% | |
| EUR | -0.17% | 0.19% | -0.04% | -0.14% | -0.23% | -0.16% | 0.21% | |
| GBP | -0.36% | -0.19% | -0.21% | -0.31% | -0.42% | -0.35% | 0.01% | |
| JPY | -0.16% | 0.04% | 0.21% | -0.12% | -0.22% | -0.18% | 0.20% | |
| CAD | -0.05% | 0.14% | 0.31% | 0.12% | -0.10% | -0.05% | 0.32% | |
| AUD | 0.06% | 0.23% | 0.42% | 0.22% | 0.10% | 0.07% | 0.44% | |
| NZD | -0.00% | 0.16% | 0.35% | 0.18% | 0.05% | -0.07% | 0.37% | |
| CHF | -0.37% | -0.21% | -0.01% | -0.20% | -0.32% | -0.44% | -0.37% |
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).
EUR/USD is trading near the 1.1770 price region after markets digested the news that European Central Bank (ECB) President Christine Lagarde may step down earlier than her planned retirement in October 2027.
GBP/USD is trading near the 1.3460 price region, under pressure from cooling United Kingdom (UK) inflation and job market conditions, which have weighed heavily on the British currency.
USD/JPY is trading near the 154.90 price region, trimming almost half of yesterday’s losses after resilient US economic data and a hawkish tone in the Federal Open Market Committee (FOMC) Minutes.
AUD/USD is trading near the 0.7050 price zone, losing all its momentum after having posted a three-year high last week.
USD/CAD is trading close to the 1.3700 level, maintaining a week-long rally as the Bank of Canada (BoC) adopts a dovish stance while inflationary pressure has remained close to the central bank’s 2% target.
Gold is trading at $4,982 seeing little change throughout the day as geopolitical tensions eased.
What’s next in the docket:
Friday, February 20:
- UK January Retail Sales.
- Germany February flash HCOB Composite PMIs.
- Eurozone PMIs.
- UK flash February S&P Global PMIs.
- US December Core Personal Consumption Expenditures.
- February US S&P Global PMIs.
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.
Commerzbank’s analysts report that India’s January trade deficit widened sharply to USD 34.7 billion, driven by a 349% surge in Gold imports as global prices rallied. Analysts expect the USD/INR pair to trade between 90.00 and 91.00 near term as portfolio outflows slow following the US-India trade deal.
Trade deficit widens but Rupee steady
"January trade deficit widened more than expected to USD34.7bn (Bloomberg consensus: USD25.4bn) vs USD25.0bn in December."
"The trade deficit could narrow in the coming months on the recently announced US-India trade deal and the pullback in gold prices."
"The pair could be range bound between 90.00-91.00 near term as portfolio outflows slow due to improving market sentiment following the trade deal with the US."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
BNY’s EMEA Macro Strategist Geoff Yu highlights that industrial metals have failed to reclaim early-year highs and sees little macro support for a rebound. Weak import prices in the US, China and Germany, ongoing Chinese PPI deflation and Indonesia’s nickel quota cuts all point to persistent demand drag, keeping downside pressure on metals and related emerging-market currencies in the near term.
Demand drag weighs on metals outlook
"Metals markets have struggled to recover their early-year highs, and we don’t expect macro data to support a rebound in the near future. Underlying demand for industrial metals has long dragged on prices and futures curves, and there is very little sign that improvement is imminent."
"In absolute terms, import prices in the U.S., China and Germany are all lower on an annualized basis, with broader Chinese producer price figures (PPI) expected to remain negative for the remainder of the year."
"The recent decision by Indonesia to cut nickel ore quotas at its largest mine underscores the downside risks to base metals and the lengths to which exposed governments are willing to go to preserve favorable terms of trade. Such headwinds are likely to affect commodity markets in the near term."
"Meanwhile, we fully expect ongoing downside risk to flow and holdings in metals-exposed currencies. This means that the need to maintain tighter financial conditions remains imperative across much of EM."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
UOB economists Enrico Tanuwidjaja and Sathit Talaengsatya expect the Bank of Thailand to cut the 1-day repurchase rate by 25 bps to 1.00% at the 25 February MPC meeting and see this as the terminal rate. They argue weak growth, subdued inflation and manageable financial stability risks justify an insurance easing within a low neutral-rate environment.
UOB sees 1.00% as terminal rate
"We maintain our view that the BOT is likely to cut the policy rate (1-day repurchase rate) by 25bps to 1.00% at the 25 Feb 2026 MPC meeting, from 1.25% currently. We see this as the terminal rate for the cycle."
"That said, when we frame the decision through the BOT’s flexible inflation targeting (FIT) objectives—growth, inflation, and financial stability—the balance of risks still supports a final cut."
"In our view, when growth is projected to run below potential for an extended period, monetary policy has a stronger case to act as insurance to reduce cyclical drag while complementary tools work through."
"In our view, 2026 cyclical nominal neutral, given depressed inflation expectations, is in the range between 0.75% and 1.25% (midpoint: 1.0%). Based on a simple Fisher’s equation, when expected inflation is very low, the nominal neutral rate that corresponds to a given neutral real rate is also low."
"Therefore, a cut to 1.00% would move policy closer to Thailand’s near-term neutral or mildly accommodative in real terms, helping support demand and reduce debt-deflation risks — without pushing policy into an aggressively low regime that could amplify search-for-yield behavior and longer-run financial stability concerns."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- USD/CHF rallies for a fourth straight day on strong labor data and weak Swiss output
- US Initial Jobless Claims dropped to 206K, well below the 225K consensus, reinforcing Fed expectations for a prolonged rate hold.
- Swiss Q4 Industrial Production contracted 0.7% year over year, the first decline since mid-2024.
- Friday's US Personal Consumption Expenditures Price Index looms as the week's key risk event.
The US Dollar extended its winning streak against the Swiss Franc on Thursday after Initial Jobless Claims fell sharply to 206K from a revised 229K the prior week, well below the 225K forecast. The data added to evidence of labor market stability and supported the Federal Reserve's (Fed) decision to hold rates at 3.50% to 3.75% at its January meeting, where minutes released Wednesday showed officials divided on the path ahead, with some flagging the possibility of hikes if inflation stays elevated. On the Swiss side, Q4 Industrial Production fell 0.7% year over year, reversing the prior quarter's 2.0% expansion and marking the first contraction since Q2 2024, underscoring the economic headwinds facing the Swiss National Bank (SNB) at its 0% policy rate.
Friday's US core Personal Consumption Expenditures Price Index (PCE) for December, the Fed's preferred inflation gauge, is the week's final catalyst and could shape rate expectations heading into the March meeting.
Four-day rally lifts pair to eight-session high near 0.7750
On the daily chart, USD/CHF rose for a fourth consecutive session on Thursday, tapping a near-term high of 0.7762 and rising nearly 0.3%, to reach its highest level in eight trading days. The pair continues to trade well below the declining 50-day Exponential Moving Average (EMA) at 0.7833 and the 200-day EMA at 0.8048, confirming the broader downtrend that has been in place since the pair's retreat from the January high near 0.8041. The four-day rally has lifted bids from the February 14 swing low near 0.7680, recovering roughly half of the prior week's decline.
The Stochastic Oscillator has crossed bullish from below the midline, pointing to building short-term momentum, though the reading remains in neutral territory. Thursday's candle printed a solid bullish body with a modest lower wick, continuing the pattern of progressively higher closes. Immediate resistance sits at the 0.7800 round number and the 50-day EMA at 0.7834; a sustained break above that zone would target the 0.7900 area. Support rests at 0.7700, with a failure there exposing the February low near 0.7605.
USD/CHF daily chart
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.
ING’s Deepali Bhargava notes that the Bangko Sentral ng Pilipinas (BSP) delivered a widely expected 25bp rate cut to 4.25%, but paired it with more cautious and uncertain guidance as growth remains softer than expected. Elevated real rates, muted GDP prospects and weak confidence suggest further easing is possible, which is likely to keep the Philippine Peso weaker versus the US Dollar.
BSP cut and guidance pressure Peso
"The BSP lowered its target rate by 25bp to 4.25%, in line with both our expectations and the broader consensus. The tone of the decision was noticeably more uncertain, reflecting a softer‑than‑expected growth recovery. This shift led the BSP to remove language suggesting it was “nearing the end of easing,” resulting in a more neutral stance."
"Looking ahead, further easing will depend heavily on how quickly confidence returns. Confidence is increasingly becoming a core driver of the BSP’s policy reaction function."
"We recently trimmed our 2026 GDP growth forecast further to 5.2% with risks skewed to the downside. The latest 4Q data shows that soft government spending has become a more persistent drag, weighing not only on fiscal outlays but also on business and household confidence. We expect this pressure to persist at least through the first half of 2026, given ongoing investigations and unresolved political uncertainty that continue to dampen sentiment."
"Against this backdrop of softer demand, elevated real rates, and lingering confidence issues, the door remains open for additional monetary easing. The risk of further monetary policy easing is likely to keep the peso weaker vs the US dollar."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
- USD/JPY consolidates near 155.00 as traders await Japan’s CPI data.
- Hawkish Fed Minutes and firm US data underpin the US Dollar.
- Reuters poll shows majority expect BoJ policy rate to reach 1% by June.
The Japanese Yen (JPY) trades in a narrow range against the US Dollar (USD) on Thursday, with USD/JPY struggling to extend its recent gains despite a firmer Greenback, as traders adopt a cautious stance ahead of Japan’s inflation data due on Friday. At the time of writing, USD/JPY is hovering around 154.95 after briefly climbing above the 155.00 handle.
The Greenback gained traction across the board after resilient US economic data and a hawkish tone in the Federal Reserve’s (Fed) January Meeting Minutes tempered market expectations for imminent rate cuts.
The US Dollar Index (DXY), which tracks the Greenback’s value against a basket of six major currencies, is trading around 97.95, its highest level since February 6.
Data released earlier in the day showed Initial Jobless Claims fell to 206K for the week ending February 14, well below the 225K forecast and down from the previous 229K. The four-week moving average eased to 219K from 220K.
Meanwhile, the Philadelphia Fed Manufacturing Survey surged to 16.3 in February, beating expectations of 8.5 and improving from 12.6 in January.
The Fed’s meeting minutes, published on Wednesday, showed policymakers divided on the monetary policy path. Several participants suggested it would be appropriate to keep rates on hold for some time while assessing incoming data, while others noted that rate cuts could become appropriate later this year if inflation declines in line with expectations. Importantly, policymakers did not rule out future rate increases if inflation remains above target.
This suggests the Fed is not in a rush to lower borrowing costs, though markets continue to price in nearly two rate cuts this year. Attention now shifts to Friday’s US data docket, including the Core Personal Consumption Expenditures (PCE) Price Index, the advance estimate of fourth-quarter US Gross Domestic Product (GDP) and preliminary February Purchasing Managers Index (PMI) data.
In Japan, National Consumer Price Index (CPI) data will be closely watched for clues on the timing of the Bank of Japan’s (BoJ) next rate hike. According to a Reuters poll conducted between February 10 and 18, all 76 economists expect the BoJ to keep interest rates unchanged at its March meeting.
However, 58% of respondents, 43 out of 74, forecast the policy rate will rise to 1% by the end of June. Among the 44 economists who specified the timing of the next hike, June was the most popular choice at 36%, followed by April at 20%, while 34% expect a move in July.
Economic Indicator
National Consumer Price Index (YoY)
Japan’s National Consumer Price Index (CPI), released by the Statistics Bureau of Japan on a monthly basis, measures the price fluctuation of goods and services purchased by households nationwide. The YoY reading compares prices in the reference month to the same month a year earlier. Generally, a high reading is seen as bullish for the Japanese Yen (JPY), while a low reading is seen as bearish.
Read more.Next release: Thu Feb 19, 2026 23:30
Frequency: Monthly
Consensus: -
Previous: 2.1%
Source: Statistics Bureau of Japan
Forex Market News
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