Forex-novosti i prognoze od 20-03-2025

• EUR/GBP trades on a firmer note around 0.8390 in Thursday’s early European session. 
• UK Unemployment Rate held steady at 4.4% in three months to January; Claimant Count Change came in at 44.2K in February.
• The BoE is expected to keep interest rates on hold at 4.5% on Thursday. 
• German parliament approves Merz's historic spending surge. 

The EUR/GBP cross holds positive ground near 0.8390 during the early European trading hours on Thursday. The Pound Sterling (GBP) softens against the Euro (EUR) after the UK employment report. The attention will shift to the Bank of England’s (BOE) interest rate decision, with no change in rate expected. 

Data released by the UK Office for National Statistics on Thursday showed that the country’s ILO Unemployment Rate climbed to 4.4% in the three months to January. This figure came in line with the expectations of 4.4% during the reported period. Meanwhile, the Claimant Count Change rose by 44.2K in February versus 2.8K prior, missing the estimated 7.9K figure. The GBP remains weak in an immediate reaction to the UK employment report. 

The BoE is expected to keep interest rates on hold on Thursday and stick to its mantra of gradual moves amid the heightened economic uncertainty. The markets anticipate the UK central bank to leave its benchmark interest rate on hold at 4.5%, with the next cut likely in May, followed by further reductions in August and November, according to the majority of economists polled by Reuters last week. 

On the Euro front, Germany's parliament approved plans for a massive spending surge on Tuesday. This positive development could provide some support to the shared currency, as the plan would provide the chancellor-in-waiting with a windfall of hundreds of billions of euros to boost investment after two years of contraction in Europe's largest economy. 

• The UK Unemployment Rate stays at 4.4% in three months to January.
• The Claimant Count Change for Britain came in at 44.2K in January.
• GBP/USD remains below 1.3000 after mixed UK employment data.

The United Kingdom’s (UK) ILO Unemployment Rate stayed unchanged at 4.4% in the three months to January, data published by the Office for National Statistics (ONS) showed on Thursday. The market consensus was for a 4.4% reading in the reported period.

Additional details of the report showed that the number of people claiming jobless benefits increased by 44.2K in February, compared with a gain of 2.8K in January, missing the expected 7.9K figure.

The Employment Change data for January came in at 144K versus December’s 107K.

Meanwhile, Average Earnings, excluding Bonus, in the UK rose 5.9% three months year-over-year (3M YoY) in January versus a 5.9% growth booked previously. Markets expected a 5.9% print.

Another measure of wage inflation, Average Earnings, including Bonus, advanced 5.8% in the same period after accelerating by a revised 6.1% in the quarter through December. The data surpassed the market forecast of 5.9%.

GBP/USD reaction to the UK employment report

GBP/USD holds lower ground on the release of the UK employment data. The pair is trading 0.02% lower on the day at 1.2985, as of writing.

(This story was corrected on March 20 at 07:09 GMT to say that "Additional details of the report showed that the number of people claiming jobless benefits increased by 44.2K in February, compared with a gain of 2.8K in January," not 22K)

• The Bank of England is expected to hold its policy rate at 4.50%.
• UK inflation figures remain well above the BoE’s target.
• GBP/USD extends its rally past the psychological 1.3000 barrier.

The Bank of England (BoE) is set to reveal its monetary policy decision on Thursday, marking the second meeting of 2025.

Expectations are high among market watchers that the central bank will keep its benchmark rate at 4.50%, following a 25 basis point reduction in the previous month. 

Alongside the decision, the BoE will publish the meeting Minutes, and Governor Andrew Bailey will hold a press conference to shed light on the reasoning behind the move.

Barring any surprises in the interest rate decision, all eyes will then shift to the bank’s forward guidance and economic outlook.    

UK economic outlook: Stubborn inflation, fading growth

The Bank of England (BoE) lived up to expectations in February, delivering a hawkish rate cut backed unanimously by the nine-member Monetary Policy Committee (MPC).

Meanwhile, fresh data from the Office for National Statistics (ONS) revealed an unexpected uptick in the UK’s annual headline inflation, which climbed to 3.0% in January from 2.5% in December. Core inflation, which excludes food and energy costs, also rose, hitting 3.7% over the last 12 months.

In addition, growth figures painted a less optimistic picture. The UK’s Gross Domestic Product (GDP) unexpectedly shrank by 0.1% in January. Furthermore, downbeat Industrial and Manufacturing Production data also added to the gloomy picture, while the S&P Global Manufacturing PMI remained stuck in contraction territory during the same month.

Following these disheartening prints, the swaps market now sees around 56 basis points of easing by the BoE through year-end.

At the BoE’s latest monetary policy gathering, Governor Andrew Bailey explained that global economic uncertainty played a key role in the decision to add the word "careful" to the bank's future interest rate guidance.

At a news conference, he remarked that this uncertainty was "two-sided" — suggesting it could either hinder the disinflation process or, conversely, accelerate it. 

"It could lead to conditions which actually make the path of disinflation less assured," Bailey noted, before adding that it "frankly could also... lead to conditions which have the opposite effect and lead to it being a faster path for disinflation."

How will the BoE interest rate decision impact GBP/USD?

As previously mentioned, investors widely anticipate the BoE keeping its interest rate unchanged on Thursday at 12:00 GMT.

With that in mind, the British Pound (GBP) will likely stand pat to the decision, but it could show some reaction to how rate-setters vote. Investors will also pay close attention to Governor Andrew Bailey’s remarks.

Ahead of the event, GBP/USD managed to trespass, albeit briefly, the psychological 1.3000 barrier, with the pair closely following USD dynamics as well as developments in the US tariff narrative.

Pablo Piovano, Senior Analyst at FXStreet, noted that GBP/USD managed to break above the critical 1.3000 hurdle earlier in the week, coming under some renewed downside pressure since then.

“Once Cable clears its 2025 high of 1.3009 (set on March 18), it could embark on a potential visit to the November 2024 top at 1.3047”, Piovano added.

“On the downside, the 200-day SMA at 1.2795 serves as the initial safety net, supported by the transitory 100-day SMA at 1.2621 and the weekly low of 1.2558 (February 28). If selling pressure accelerates, the pair could dip toward the 55-day SMA at 1.2552, followed by deeper support at the February trough of 1.2248 (February 3) and the 2025 bottom at 1.2099 (January 13)”, Piovano concluded.

• The US Dollar Index recovers some lost ground to near 103.50 in Thursday’s early European session. 
• The DXY keeps the negative outlook below the 100-day EMA with a bearish RSI indicator. 
• The first downside target to watch is 103.20; the immediate upside barrier is seen at 104.10. 

The US Dollar Index (DXY), an index of the value of the US Dollar (USD) measured against a basket of six world currencies, trades in positive territory near 103.50 during the early European session on Thursday. 

However, the upside of the DXY might be limited as the Federal Reserve (Fed) indicated interest rate cuts were likely later this year. Additionally, the Fed officials lowered its forecast for economic growth and revised both its inflation projection and unemployment estimates higher.

According to the daily chart, the bearish outlook of the DXY remains intact, with the index holding below the key 100-day Exponential Moving Average (EMA). Further downside looks favorable as the 14-day Relative Strength Index (RSI), which stands below the midline near 31.75. 

The initial support level for the USD index is located at 103.20, the low of March 18. Sustained trading below the mentioned level could expose 101.88, the lower limit of the Bollinger Band. A breach of this level could see a drop to 100.53, the low of August 28, 2024. 

On the other hand, the high of March 14 at 104.10 acts as an immediate resistance level for the DXY. The additional upside filter to watch is 105.45, the high of November 6, 2024. The key upside barrier is seen at 106.00, representing the 100-day EMA and the psychological level. 

US Dollar Index (DXY) daily chart

• EUR/USD continues to decline ahead of ECB President Christine Lagarde’s speech at the European Parliament in Brussels.
• The US Dollar struggled as US yields weakened, following Fed’s reaffirmation of its outlook for two rate cuts in 2025.
• Germany’s proposed economic plan, aimed at stimulating growth and boosting defense spending, could contribute to rising inflation and broader economic expansion.

EUR/USD loses ground for the second successive day, trading around 1.0900 during Asian hours on Thursday. However, the pair strengthened as the US Dollar (USD) remained under pressure, weighed down by declining yields after the Federal Reserve (Fed) reaffirmed its outlook for two rate cuts later this year. However, uncertainty surrounding US President Donald Trump’s tariff policies adds a layer of caution.

Meanwhile, US Treasury bonds gained traction following the Fed’s decision to slow the pace of quantitative tightening, citing concerns over reduced liquidity and potential risks tied to government debt limits.

The US Dollar Index (DXY), which tracks the USD against six major currencies, is hovering near 103.40, while US Treasury yields continue to decline. The 2-year yield stands at 3.97%, and the 10-year yield at 4.24%.

On Wednesday, as expected, the Federal Reserve held the federal funds rate steady at 4.25%–4.5% during its March meeting. Fed Chair Jerome Powell noted, “Labor market conditions are solid, and inflation has moved closer to our 2% longer-run goal, though it remains somewhat elevated.”

In Europe, German leaders approved a debt restructuring plan proposed by likely Chancellor Friedrich Merz on Tuesday. The plan aims to stimulate economic growth and increase defense spending. Market participants anticipate that a shift away from Germany’s long-standing fiscal conservatism could drive inflation and economic expansion, prompting the European Central Bank (ECB) to reassess its current monetary policy.

Traders will likely observe ECB President Christine Lagarde on Thursday, who is scheduled to deliver an introductory statement on Economic and Monetary Affairs (ECON) at the European Parliament in Brussels, Belgium.

FX option expiries for Mar 20 NY cut at 10:00 Eastern Time via DTCC can be found below.

EUR/USD: EUR amounts

• 1.0800 1.6b
• 1.0860 834m
• 1.0875 1.6b
• 1.0900 2.7b
• 1.0910 1.5b

GBP/USD: GBP amounts     

• 1.3000 452m

USD/JPY: USD amounts                                 

• 150.00 813m
• 150.70 905m

USD/CHF: USD amounts     

• 0.8800 419m

AUD/USD: AUD amounts

• 0.6400 1b
• 0.6405 639m

USD/CAD: USD amounts       

• 1.4125 485m
• 1.4500 731m

NZD/USD: NZD amounts

• 0.5670 1.5b

EUR/GBP: EUR amounts        

• 0.8400 655m

• GBP/JPY extends the overnight pullback from the vicinity of over a two-month high.
• BoJ rate hike bets and the flight to safety underpin the JPY, exerting some pressure.
• A mixed technical setup warrants caution for bulls ahead of the BoE policy decision. 

The GBP/JPY cross attracts sellers for the second successive day on Thursday and extends this week's retracement slide from the vicinity of the 195.00 psychological mark, or over a two-month high. Spot prices weaken further below the 193.00 round figure during the Asian session and seem vulnerable to slide further amid a broadly stronger Japanese Yen (JPY).

Expectations that strong wage growth could boost consumer spending and contribute to rising inflation give the Bank of Japan (BoJ) headroom to keep hiking interest rates. Apart from this, the uncertainty over US President Donald Trump's trade policies and geopolitical risks underpin the safe-haven JPY, which, in turn, is seen exerting pressure on the GBP/JPY cross. The British Pound (GBP), on the other hand, struggles to gain any traction as traders opt to wait for the Bank of England (BoE) decision. 

From a technical perspective, spot price earlier this week struggled to find acceptance above the very important 200-day Simple Moving Average (SMA) and the subsequent fall could be seen as a key trigger for bearish traders. That said, oscillators on the daily chart are still holding in positive territory. Adding to this, the recent breakout through the 192.50 horizontal resistance warrants some caution before positioning for any further depreciating move heading into the key central bank event risk.

In the meantime, the aforementioned resistance breakpoint could protect the immediate downside, below which the GBP/JPY cross could accelerate the slide towards the 192.00 mark en route to the 191.35-191.30 support zone. Some follow-through selling has the potential to drag spot prices below the 191.00 round figure, towards the next relevant support near the 190.45-190.40 area en route to the 190.00 psychological mark and the 189.70-189.65 region. 

On the flip side, any positive move might now confront resistance near the 194.00 round-figure mark ahead of the 200-day SMA, currently pegged around the 194.30 region. This is followed by the 194.90 region, or a multi-month peak touched earlier this week, which if cleared decisively should pave the way for additional gains. The GBP/JPY cross might then climb to the 196.00 mark en route to the 196.40 horizontal zone before aiming to reclaim the 197.00 round figure for the first time since January. 

GBP/JPY daily chart

• USD/CHF weakens to around 0.8760 in Thursday’s Asian session. 
• The Fed held its benchmark overnight rate steady in the 4.25%-4.50% range.
• The SNB is expected to cut rates by 25 bps at its March meeting on Thursday. 

The USD/CHF pair attracts some sellers to near 0.8760 during the Asian trading hours on Thursday. The Greenback edges lower after the Federal Reserve (Fed) indicated interest rate cuts were likely later this year despite the high degree of uncertainty around US tariff policies. Later on Thursday, the Swiss National Bank (SNB) interest rate decision will be in the spotlight. 

On Wednesday, the Fed kept interest rates unchanged in a range of 4.25% to 4.5% at its March meeting, as widely expected. The US central bank signaled it will cut rates two more times this year, in line with its previous projection from December. 

However, the Fed officials lowered its forecast for economic growth and revised both its inflation projection and unemployment estimates higher. This, in turn, weighs on the USD against the Swiss Franc (CHF). Traders are now pricing in nearly 66 basis points (bps) of rate cuts this year from the Fed, about two rate reductions of 25 bps each, with a cut in July fully priced in, according to the LSEG data. 

On the Swiss front, the markets expect the SNB to lower its benchmark interest rate by 25 bps to 0.25% at its policy meeting on Thursday. The decision follows a 50 bps reduction in December and comes amid subdued inflation, a strong CHF, and an uncertain global economic outlook. Nonetheless, worries about the CHF's strength remain, and the Swiss central bank could attempt to alleviate this pressure by cutting interest rates and maybe intervening in the foreign currency market.

Gold prices rose in India on Thursday, according to data compiled by FXStreet.

The price for Gold stood at 8,472.91 Indian Rupees (INR) per gram, up compared with the INR 8,452.50 it cost on Wednesday.

The price for Gold increased to INR 98,821.50 per tola from INR 98,588.26 per tola a day earlier.

Daily Digest Market Movers: Gold price continues to attract safe-haven flows amid trade jitters, geopolitical risks

• Asian equity markets track the overnight gains on Wall Street, bolstered by the Federal Reserve's decision to keep interest rates unchanged and maintain its rate cut forecast for the year. As was widely expected, the US central bank held interest rates steady for the second straight meeting and signaled that it would deliver two 25 basis points rate cuts by the end of this year. 

• Adding to this, US President Donald Trump and Russian President Vladimir Putin agreed on Tuesday for an immediate pause in strikes against energy infrastructure in the Ukraine war. Moreover, Ukrainian President Volodymyr Zelenskiy and Trump also agreed to work together to end the protracted Russia-Ukraine war, which further boosted investors' confidence. 

• Meanwhile, Fed officials trimmed their growth forecast for the year amid the growing uncertainty over the impact of the Trump administration's aggressive trade policies on economic activity. Trump imposed a flat 25% duty on steel and aluminum since February and has threatened to impose reciprocal and sectoral tariffs, fueling worries about a global trade war.

• Traders now see over a 65% chance that the Fed would resume its rate-cutting cycle at the June policy meeting. This, in turn, fails to assist the US Dollar in registering any meaningful recovery from a multi-month low touched earlier this week and should lend some support to the non-yielding Gold price amid the risk of a further escalation of tensions in the Middle East. 

• The Israeli military said that it launched a limited ground incursion into Gaza, a day after an aerial bombardment of the strip that shattered the two-month-old ceasefire with Hamas. Moreover, Israeli Prime Minister Benjamin Netanyahu warned of fierce war expansion, which should continue to underpin the safe-haven precious metal and limit any corrective slide.

• Traders now look forward to the latest monetary policy updates from the Bank of England and the Swiss National Bank. Later during the North American session, the US economic docket – featuring the usual Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, and Existing Home Sales data – could produce short-term opportunities around the XAU/USD. 

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.

(An automation tool was used in creating this post.)

• Gold price hits fresh record high as a combination of factors continues to boost safe-haven demand.
• The Fed’s dovish outlook keeps the USD bulls on the defensive and further underpins the XAU/USD.
• Slightly overbought conditions and a positive risk tone act as a headwind for the precious metal.

Gold price (XAU/USD) enters a bullish consolidation phase after touching a fresh all-time peak during the Asian session on Thursday. Bulls now seem reluctant to place fresh bets amid slightly overbought conditions and a positive risk tone, which tends to undermine the safe-haven precious metal. Any meaningful corrective decline, however, still seems elusive in the wake of the growing uncertainty over US President Donald Trump's trade policies and their impact on the global economy. 

Apart from this, geopolitical risk and dovish Federal Reserve (Fed) expectations should act as a tailwind for the non-yielding Gold price. Meanwhile, the US Dollar (USD) struggles to gain any meaningful traction and languishes near its lowest level since October touched earlier this week amid bets that the Fed will resume its rate-cutting cycle soon. This could further contribute to limiting the downside for the commodity and warrants caution before confirming a near-term top for the bullion.

Daily Digest Market Movers: Gold price continues to attract safe-haven flows amid trade jitters, geopolitical risks

• Asian equity markets track the overnight gains on Wall Street, bolstered by the Federal Reserve's decision to keep interest rates unchanged and maintain its rate cut forecast for the year. As was widely expected, the US central bank held interest rates steady for the second straight meeting and signaled that it would deliver two 25 basis points rate cuts by the end of this year. 
• Adding to this, US President Donald Trump and Russian President Vladimir Putin agreed on Tuesday for an immediate pause in strikes against energy infrastructure in the Ukraine war. Moreover, Ukrainian President Volodymyr Zelenskiy and Trump also agreed to work together to end the protracted Russia-Ukraine war, which further boosted investors' confidence. 
• Meanwhile, Fed officials trimmed their growth forecast for the year amid the growing uncertainty over the impact of the Trump administration's aggressive trade policies on economic activity. Trump imposed a flat 25% duty on steel and aluminum since February and has threatened to impose reciprocal and sectoral tariffs, fueling worries about a global trade war.
• Traders now see over a 65% chance that the Fed would resume its rate-cutting cycle at the June policy meeting. This, in turn, fails to assist the US Dollar in registering any meaningful recovery from a multi-month low touched earlier this week and should lend some support to the non-yielding Gold price amid the risk of a further escalation of tensions in the Middle East. 
• The Israeli military said that it launched a limited ground incursion into Gaza, a day after an aerial bombardment of the strip that shattered the two-month-old ceasefire with Hamas. Moreover, Israeli Prime Minister Benjamin Netanyahu warned of fierce war expansion, which should continue to underpin the safe-haven precious metal and limit any corrective slide.
• Traders now look forward to the latest monetary policy updates from the Bank of England and the Swiss National Bank. Later during the North American session, the US economic docket – featuring the usual Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, and Existing Home Sales data – could produce short-term opportunities around the XAU/USD. 

Gold price needs to consolidate before the next leg up amid slightly overbought conditions on the daily chart

The daily Relative Strength Index (RSI) remains above the 70 mark, flashing overbought conditions and holding back bulls from placing fresh bets. Hence, it will be prudent to wait for some near-term consolidation or a modest pullback before traders start positioning for an extension of the recent well-established uptrend witnessed over the past three months or so. That said, the recent breakout through the $3,000 psychological mark and the subsequent move up suggest that the path of least resistance for the Gold price remains to the upside. 

Meanwhile, any meaningful corrective slide is likely to attract some dip-buyers around the $3,023-3,022 area. This should help limit the downside near the $3,000 mark, which should now act as a key pivotal point for short-term traders. A convincing break below the latter might prompt some technical selling and drag the Gold price to the $2,980-2,978 intermediate support en route to the $2,956 region. The downward trajectory could extend further towards the $2,930 support before the XAU/USD drops to the $2,900 mark and last week's swing low, around the $2.880 area.

• GBP/USD may target the immediate resistance at the five-month high at 1.3048.
• The 14-day RSI indicates an overbought situation and a potential downward correction.
• The primary support appears at a nine-day EMA of 1.2955.

The GBP/USD pair remains in positive territory for the fourth successive session, trading around 1.3010 during the Asian hours on Thursday. Technical analysis of the daily chart indicates a continued bullish bias, with the pair moving upwards within an ascending channel pattern.

The 14-day Relative Strength Index (RSI) is slightly above 70, signaling strong bullish momentum but also suggesting that the GBP/USD pair is overbought, potentially leading to a downward correction.

Moreover, the GBP/USD pair continues to trade above the nine-day Exponential Moving Average (EMA), reinforcing strong short-term price dynamics and confirming the ongoing upward trend.

On the upside, the GBP/USD pair may challenge primary resistance at the five-month high at 1.3048, recorded on November 6, followed by the ascending channel’s upper boundary near 1.3090.

The GBP/USD pair is likely to find immediate support at the nine-day EMA of 1.2954. A break below this level could weaken short-term price momentum, potentially driving the pair toward the ascending channel’s lower boundary near 1.2770, followed by the 50-day EMA at 1.2705.

GBP/USD: Daily Chart

• Silver price faced headwinds as the Fed maintained the federal funds rate at 4.25%–4.5% on Wednesday
• The non-yielding Silver may have found support as US Treasury yields declined.
• Silver lease rates have surged due to shrinking stockpiles in London.

Silver price (XAG/USD) holds onto gains after a previous session of losses, trading around $33.80 per troy ounce during Asian hours on Thursday. However, the non-interest-bearing metal faces pressure following the Federal Reserve’s (Fed) interest rate decision.

As widely expected, the Fed maintained the federal funds rate at 4.25%–4.5% during its March meeting but reaffirmed its outlook for two rate cuts later this year. This stance aligns with forecasts of slower GDP growth and higher unemployment, counterbalancing concerns over rising inflation in the United States (US), potentially driven by aggressive tariffs imposed by President Donald Trump.

Silver, a non-yielding asset, may have found support as US Treasury yields declined, with the 2-year yield at 3.97% and the 10-year yield at 4.24%. Meanwhile, bonds gained traction following the Fed’s decision to slow the pace of quantitative tightening, citing concerns over reduced liquidity and potential risks tied to government debt limits.

Silver lease rates have surged due to shrinking stockpiles, particularly in London, as Silver flows toward the US to capitalize on higher prices. Banks and traders lease Silver to ensure short-term liquidity for trading or operational needs.

This shift has widened price gaps between major markets, with spot silver up 17% this year, outperforming other commodities. Additionally, physical Silver transfers from Canada and Mexico are strained by tariffs, further tightening supply. Growing fears of a “silver squeeze” could disrupt trade for months.

• The Japanese Yen draws support from BoJ rate hike bets and the global flight to safety.
• Trade jitters and escalating geopolitical tensions continue to benefit safe-haven assets. 
• The divergent BoJ-Fed expectations also exert downward pressure on the USD/JPY pair.

The Japanese Yen (JPY) attracts buyers for the second straight day and strengthens to a fresh weekly high against its American counterpart during the Asian session on Thursday. Expectations that strong wage growth could boost consumer spending and contribute to rising inflation give the Bank of Japan (BoJ) headroom to keep hiking interest rates. This led to the recent sharp narrowing of the rate differential between Japan and other countries, which continues to support the lower-yielding JPY. 

Apart from this, the uncertainty over US President Donald Trump's trade policies and their impact on the global economy, along with geopolitical risks and the Turkish political crisis, drive some safe-haven flows toward the JPY. The US Dollar (USD), on the other hand, struggles to gain any meaningful traction amid increased economic uncertainty on the back of US President Donald Trump’s trade tariffs. This, in turn, exerts pressure on the USD/JPY pair and contributes to the intraday downfall. 

Japanese Yen is underpinned by hawkish BoJ expectations and persistent safe-haven demand

• The Bank of Japan decided to keep its key policy rate steady at the end of a two-day review meeting on Wednesday and noted that the uncertainty surrounding Japan's economy, and prices remains high. 
• In the post-meeting presser, BoJ Governor Kazuo Ueda said that the central bank wants to conduct policies before it is too late and that achieving a 2% inflation target is important for long-term credibility. 
• The Federal Reserve, as was widely anticipated, also held interest rates steady for the second meeting in a row and signaled that it is likely to deliver two 25 basis points rate cuts by the end of this year. 
• Meanwhile, policymakers trimmed their growth forecast for the year amid the growing uncertainty over the impact of US President Donald Trump's aggressive trade policies on economic activity. 
• Furthermore, the Fed gave a bump higher to its inflation projection. Traders, however, still see over a 65% chance that the US central bank would resume its rate-cutting cycle at the June policy meeting. 
• Ukrainian President Volodymyr Zelenskiy and Trump agreed to work together to end the Russia-Ukraine war. Russian President Vladimir Putin, however, rejected a proposed full 30-day ceasefire.
• The Israeli military said that it launched a limited ground incursion into Gaza, a day after an aerial bombardment of the strip that shattered the two-month-old ceasefire with Hamas.
• Israeli Prime Minister Benjamin Netanyahu warned of fierce war expansion, raising the risk of a further escalation of Middle East tensions and benefiting safe-haven assets, including the Japanese Yen. 

USD/JPY seems vulnerable to weaken further and aim to test the 147.75 next relevant support

From a technical perspective, the overnight failure to find acceptance above the 150.00 psychological mark and the subsequent decline suggests that the recent bounce from a multi-month low has run out of steam. Moreover, negative oscillators on the daily chart support prospects for a further depreciating move for the USD/JPY pair. Hence, some follow-through weakness below the 148.00 mark, towards the next relevant support near the 147.75 horizontal support, looks like a distinct possibility. The downward trajectory could extend further towards the 147.30 region en route to the 147.00 round figure and the 146.55-146.50 area, or the lowest level since early October touched earlier this month. 

On the flip side, any attempted recovery might now confront an immediate hurdle near the Asian session high, just ahead of the 149.00 mark. This is followed by the 149.25-149.30 supply zone, above which the USD/JPY pair could aim to reclaim the 150.00 mark. Some follow-through buying beyond the overnight swing high, around the 150.15 region, could prompt a short-covering rally and lift spot prices to the 150.60 intermediate barrier en route to the 151.00 mark and the monthly peak, around the 151.30 region.

• The Indian Rupee softens in Thursday’s Asian session. 
• A rebound in oil prices and the Fed’s hawkish stance drag the INR lower.
• Investors await the US weekly Initial Jobless Claims data, which is due later on Thursday. 

The Indian Rupee (INR) trades in negative territory on Thursday. A rise in Crude Oil prices amid the ongoing geopolitical tensions in the Middle East weighs on the local currency as India is the world's third-largest oil consumer. Furthermore, the more hawkish stance from the US Federal Reserve (Fed) at its March meeting on Wednesday lifts the US Dollar (USD) and undermines the Indian currency. 

However, India’s latest current account data, which showed a surplus in February, might help limit the INR’s losses. The Reserve Bank of India (RBI) has likely been "opportunistically" absorbing USD inflows over the past few sessions, probably to replenish the foreign exchange reserve expanded to support the INR over the past few months, according to reports. Looking ahead, the US weekly Initial Jobless Claims will be released later on Thursday, followed by the Philly Fed Manufacturing Index, Existing Home Sales, and the CB Leading Index.

Indian Rupee remains fragile amid multiple headwinds

• India's foreign exchange reserves have risen from $624 billion in January to $654 billion by early March, though they remain $50 billion below their peak in October. 
• The Fed held rates steady at the 4.25%-4.50% range at the March meeting on Wednesday, as widely anticipated. 
• Fed officials still see reducing borrowing costs by half a percentage point by the end of this year due to slowing economic growth and a downturn in inflation.
• Fed Chair Jerome Powell highlighted the high degree of uncertainty from US President Donald Trump’s significant policy changes, adding that the Fed officials can wait for more clarity on the impact of those policies on the economy before acting.
• Powell stated during a press conference, “Labor market conditions are solid, and inflation has moved closer to our 2% longer-run goal, though it remains somewhat elevated.”

USD/INR keeps the bullish vibe in the longer term

The Indian Rupee trades on a softer note on the day. In the longer term, the USD/INR pair maintains its constructive outlook on the daily timeframe. Nonetheless, in the near term, the pair has broken out of a symmetrical triangle, while the 14-day Relative Strength Index (RSI) stands below the midline near 37.00, suggesting that further downside looks favorable. 

The 87.00 psychological level appears to be a tough nut to crack for USD/INR. A decisive break above this level could see a rally to 87.38, the high of March 11, en route to 87.53, the high of February 28.

On the downside, the crucial support level is located at 86.00, the round mark and the 100-day EMA. A breach of the mentioned level could attract some sellers and drag the pair lower to 85.60, the low of January 6. 

In his latest post on the Truth Social platform, US President Donald Trump called on the Federal Reserve (Fed) to lower interest rates, as tariffs are hurting the economy.

Key quotes

"The Fed would be MUCH better off CUTTING RATES as US tariffs start to transition (ease!) their way into the economy.”

“Do the right thing.”

“April 2nd is Liberation Day in America!!!"

Market reaction

The US Dollar Index (DXY) loses 0.11% on the day, trading near 103.40, following Trump’s comments.

• AUD/JPY loses ground as Australia’s Employment Change declined by 52.8K in February, missing the expected 30.0K increase.
• The PBOC maintained its one- and five-year Loan Prime Rates (LPRs) at 3.10% and 3.60%, respectively.
• The Japanese Yen strengthens as traders continue to factor in the possibility of a BoJ rate hike in 2025.

AUD/JPY continues its losing streak for the third consecutive session, trading around 94.00 during Asian hours on Thursday. The currency cross weakens as the Australian Dollar (AUD) faces downward pressure following disappointing domestic employment data.

Australia’s Employment Change fell by 52.8K in February, a sharp decline from the revised 44K increase in January and well below the expected 30.0K rise. However, the seasonally adjusted Unemployment Rate remained steady at 4.1%, in line with market expectations.

Meanwhile, in China, a key trading partner for Australia, the People’s Bank of China (PBOC) kept its Loan Prime Rates (LPRs) unchanged on Thursday, maintaining the one-year rate at 3.10% and the five-year rate at 3.60%. Developments in the Chinese economy often influence the China-proxy AUD.

The Japanese Yen (JPY) strengthens, contributing to the decline in the AUD/JPY cross, as traders continue to price in the possibility of a Bank of Japan (BoJ) rate hike in 2025. On Wednesday, the BoJ maintained its short-term interest rate target within the 0.40%-0.50% range.

The BoJ’s Monetary Policy Statement indicated that Japan's economy is experiencing moderate recovery, despite some lingering weaknesses. Consumption gradually increases, and inflation expectations are rising at a measured pace. In a post-meeting press conference, BoJ Governor Kazuo Ueda emphasized that the central bank will adjust its policy to ensure the sustainable and stable achievement of its price targets.

• The Australian Dollar depreciated as Employment Change declined by 52.8K in February, missing the consensus forecast of a 30.0K increase.
• The PBOC kept its Loan Prime Rates (LPRs) unchanged, with the one- and five-year rates at 3.10% and 3.60%, respectively.
• The Fed reaffirmed its expectation of two rate cuts later this year but highlighted uncertainty arising from Trump’s tariff policies.

The Australian Dollar (AUD) weakens against the US Dollar (USD) on Thursday, reversing gains from the previous session. The AUD/USD pair declines as the AUD receives downward pressure following the release of domestic employment data.

Australia’s Employment Change dropped by 52.8K in February against the 30.5K increase in January (revised from 44K), falling short of the consensus forecast of 30.0K rise. Meanwhile, the seasonally adjusted Unemployment Rate remained steady at 4.1% in February, aligning with market expectations.

In China, the People’s Bank of China (PBOC) kept its Loan Prime Rates (LPRs) unchanged on Thursday, with the one-year rate at 3.10% and the five-year rate at 3.60%.

The Federal Reserve maintained the federal funds rate at 4.25%–4.5% in its March meeting, as widely expected. The Fed reaffirmed its outlook for two rate cuts later this year but cited uncertainty stemming from US President Donald Trump’s tariff policies.

Australian Dollar could find support as US Dollar struggles following Fed decision

• The US Dollar Index (DXY), which measures the USD against six major currencies, is trading lower near 103.40. The Greenback faced pressure as yields on US Treasury bonds declined, with the 2-year yield at 3.97% and the 10-year yield at 4.24%.
• However, the US Dollar found some stability after hawkish remarks from Fed Chair Jerome Powell, who stated, “Labor market conditions are solid, and inflation has moved closer to our 2% longer-run goal, though it remains somewhat elevated.”
• President Trump and Russian President Vladimir Putin, on Tuesday, agreed to an immediate pause in strikes targeting energy infrastructure in the Ukraine war. In a Truth Social post following his call with Putin, Trump stated that both sides had committed to a 30-day halt on attacks against each other's energy infrastructure, mirroring statements from the Kremlin.
• Putin declined to endorse a broader month-long ceasefire negotiated by Trump’s team with Ukrainian officials in Saudi Arabia, signaling continued tensions despite the temporary agreement on energy targets.
• Trump reaffirmed plans to impose reciprocal and sectoral tariffs on April 2. Trump confirmed that there would be no exemptions for steel and aluminum and mentioned that reciprocal tariffs on specific countries would be implemented alongside auto duties.
• According to Reuters, Trump’s proposal to boost US shipbuilding by imposing steep fees on China-linked vessels entering American ports is causing a buildup of US coal inventories and increasing uncertainty in the already struggling agriculture sector.
• Treasurer Jim Chalmers addressed trade tensions in a speech on Tuesday, rejecting a "race to the bottom" on tariffs. Chalmers criticized the Trump administration’s trade policies as "self-defeating and self-sabotaging," emphasizing Australia’s need to focus on economic resilience rather than retaliation. He also condemned the US decision to exclude Australia from steel and aluminum tariff exemptions, calling it "disappointing, unnecessary, senseless, and wrong," as per "The Guardian".
• On Monday, Reserve Bank of Australia (RBA) Assistant Governor (Economic) Sarah Hunter reiterated the central bank’s cautious stance on rate cuts. The RBA’s February statement signaled a more conservative approach than market expectations, with a strong focus on monitoring US policy decisions and their potential impact on Australia’s inflation outlook.

Australian Dollar breaks below 0.6350, ascending channel’s lower boundary

AUD/USD is trading near 0.6330 on Thursday, with technical analysis suggesting a weakening bullish bias as the pair breaks below the ascending channel pattern. However, the 14-day Relative Strength Index (RSI) remains above 50, indicating that bullish momentum is still in play.

The pair may attempt to surpass the immediate resistance at the nine-day Exponential Moving Average (EMA) of 0.6337, which aligns with the lower boundary of the ascending channel. A return to the channel could reinforce the bullish outlook, potentially leading AUD/USD to retest its three-month high of 0.6408, last reached on February 21. Further resistance is seen at the upper boundary of the channel near 0.6490.

On the downside, immediate support lies at the 50-day EMA at 0.6312. A decisive break below this key level could weaken the medium-term price momentum, exposing the AUD/USD pair to further downside pressure toward the six-week low of 0.6187, recorded on March 5.

AUD/USD: Daily Chart

• WTI price drifts higher to $67.20 in Thursday’s early Asian session. 
• The Israeli military resumed ground operations in central and southern Gaza, underpinning the WTI price. 
• Crude oil stockpiles in the US rose by 1.745 million barrels last week, according to the EIA. 

West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $67.20 during the early Asian session on Thursday. The WTI price edges higher amid the ongoing geopolitical tensions in the Middle East. However, the Federal Reserve's (Fed) decision to hold interest rates steady might cap the upside for WTI price. 

The Israeli military resumed ground operations in the central and southern Gaza Strip. US President Donald Trump threatened to continue his country’s attack on Yemen's Houthis and said he would hold Iran responsible for any attacks carried out by the group that has disrupted shipping in the Red Sea. The Red Sea disruption has caused an increase in energy transportation prices and the WTI price since oil and gas cargo shipments have been forced to take longer routes.

"Traders are being forced to refocus on Mideast geopolitical risks as Israel and the United States launch attacks on Gaza and Yemen, respectively," said Clay Seigle, senior fellow for energy security at the Center for Strategic and International Studies.

Crude Oil inventories climbed last week. The US Energy Information Administration (EIA) weekly report showed crude oil stockpiles in the United States for the week ending March 14 rose by 1.745 million barrels, compared to an increase of 1.448 million barrels in the previous week. The market consensus estimated that stocks would increase by 1.17 million barrels. 

The US Federal Reserve (Fed) held rates steady at the 4.25%-4.50% range at the March meeting on Wednesday, as widely anticipated. Nonetheless, Fed officials still see reducing borrowing costs by half a percentage point by the end of this year due to slowing economic growth and a downturn in inflation. This, in turn, raises concerns about slower energy demand and weighs on WTI price.

The People’s Bank of China (PBOC) set the USD/CNY central rate for the trading session ahead on Thursday at 7.1754 as compared to the previous day's fix of 7.1697 and 7.2402 Reuters estimate.

The People’s Bank of China (PBOC), China's central bank, announced to leave its Loan Prime Rates (LPRs) unchanged on Thursday. The one-year and five-year LPRs were at 3.10% and 3.60%, respectively. 

Market reaction

At the time of writing, the AUD/USD pair is trading 0.64% lower on the day to trade at 0.6336.

Australia’s Unemployment Rate steadied at 4.1% in in February from 4.1% in January, according to the official data released by the Australian Bureau of Statistics (ABS) on Thursday. The figure came in line with the market consensus.

Furthermore, the Australian Employment Change arrived at -52.8K in February from 30.5K in January (revised from 44K), compared with the consensus forecast of 30K.

The participation rate in Australia declined to 66.8% in February, compared to 67.2% in February (revised from 67.3%). Meanwhile, Full-Time Employment decreased by 35.7K in the same period from a rise of 36.9K in the previous reading (revised from 54.1K). The Part-Time Employment decreased by 17K in February versus -6.5K prior (revised from -10.1K).

Market reaction to the Australia’s employment data

The Australian Dollar (AUD) attracts some sellers following the employment data. At the time of writing, the AUD/USD pair is trading 0.52% lower on the day to trade at 0.6343.

Australia’s Unemployment Rate steadied at 4.1% in in February from 4.1% in January, according to the official data released by the Australian Bureau of Statistics (ABS) on Thursday. The figure came in line with the market consensus.

Furthermore, the Australian Employment Change arrived at -52.8K in February from 30.5K in January (revised from 44K), compared with the consensus forecast of 30K.

The participation rate in Australia declined to 66.8% in February, compared to 67.2% in February (revised from 67.3%). Meanwhile, Full-Time Employment decreased by 35.7K in the same period from a rise of 36.9K in the previous reading (revised from 54.1K). The Part-Time Employment decreased by 17K in February versus -6.5K prior (revised from -10.1K).

Market reaction to the Australia’s employment data

The Australian Dollar (AUD) attracts some sellers following the employment data. At the time of writing, the AUD/USD pair is trading 0.52% lower on the day to trade at 0.6343.

• NZD/USD drifts higher to near 0.5820 in Wednesday's early Asian session.
• New Zealand’s GDP rose 0.7% QoQ in Q4, stronger than expected. 
• Fed held interest rates steady and still sees two reductions coming this year. 

The NZD/USD pair trades in a positive territory around 0.5820 during the early Asian session on Thursday. The New Zealand Dollar (NZD) gains ground after the stronger-than-expected growth data in the fourth quarter of 2024. However, the upside for the pair might be limited as the Federal Reserve (Fed) maintained its interest rates at its meeting, which supports the Greenback.

Data released by Statistics New Zealand on Thursday showed that New Zealand's Gross Domestic Product (GDP) grew by 0.7% QoQ in the fourth quarter (Q4) versus -1.1% prior (revised from -1.0%). This reading came in above the consensus of 0.4%. The annual Q4 GDP contracted by 1.1%, following a decline of 0.3% in Q3, while beating the estimation of a 1.4% fall. Kiwibank chief economist Jarrod Kerr said New Zealand was crawling out of recession. The Kiwi trades slightly firmer in an immediate reaction to the upbeat GDP data. 

The Fed kept the federal funds rate at a range of 4.25% to 4.5% at its March meeting on Wednesday, as widely expected. That said, the US central bank maintained its outlook at two rate cuts coming in the remainder of this year, citing the uncertainty from US President Donald Trump’s tariff policies. 

During a press conference, Federal Chair Jerome Powell noted, “Labor market conditions are solid, and inflation has moved closer to our 2% longer-run goal, though it remains somewhat elevated.” The more hawkish comments from the Fed officials could support the Greenback and act as a headwind for the NZD/USD pair in the near term. 

• EUR/USD remains hobbled on the south side of 1.1000.
• The Fed held interest rate steady, as investors expected.
• Despite downside risks to growth and inflation, Fed still sees rate cuts in 2025.

EUR/USD remained bolstered above the 1.0900 handle on Wednesday, propped up by a general easing in Greenback flows after the Federal Reserve (Fed) met markets in the middle and held rates steady for another meeting. Fed Chair Jerome Powell noted that growth projections for 2025 have been significantly hindered by the Trump administration's erratic policy of announcing trade tariffs on social media only to later retract them. As a result, the Federal Open Market Committee (FOMC) revised its end-2025 Gross Domestic Product (GDP) forecast to 1.7%, a sharp decline from the 2.1% estimate shared in December.

Fed's Powell: We are not going to be in any hurry to move on rate cuts

Additionally, the median dot plot suggests that the end-2025 interest rate will remain at 3.9%, indicating little change since the last policy meeting. The FOMC plans to begin slowing down its balance sheet runoff starting in April. Rate markets continue to signal a greater than 50% chance of a quarter-point rate cut in June, with most rate traders assigning a 65% probability of a quarter-point or larger cut on June 18.

Despite rising risks to the US economy from lagging growth metrics and increasing concerns that the US's erratic tariff policy could trigger both new inflation and an economic recession simultaneously, Fed Chair Jerome Powell stated on Wednesday that the current economic outlook remains generally healthy, and the Fed is not in a hurry to alter its expectations of at least two more rate cuts later in the year.

European Central Bank (ECB) President Christine Lagarde will be making an appearance on Thursday, and the latest round of the EU’s Leadership Summit also kicks off. ECB talking points are highly unlikely to produce nearly as many sparks as the Fed’s outing on Wednesday, so Fiber impacts are set to remain muted.

EUR/USD price forecast

From a technical viewpoint, the Stochastic Oscillator is currently in overbought territory above 80.00, though it is showing signs of flattening, indicating a reduction in bullish momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) displays flat green bars, suggesting a lack of strong trend conviction. Collectively, these indicators imply that the pair may enter a consolidation phase prior to making a definitive move.

Looking ahead, resistance is positioned at the 1.1000 level, which has historically served as a significant barrier. On the downside, initial support can be found around 1.0850, with more substantial support near the 20-day moving average close to 1.0800. A decline below these thresholds could trigger a corrective reaction, while consistent trading above 1.0900 would maintain the overall bullish outlook.

EUR/USD daily chart