CFD Markets Analysis: News and forecasts for 20 tháng 2 2025

23:50

Japan’s National CPI climbs 4.0% YoY in January, Core CPI rises more than expected

Japan’s National Consumer Price Index (CPI) climbed 4.0% YoY in January, compared to the previous reading of 3.6%, according to the latest data released by the Japan Statistics Bureau on Friday.

Further details unveil that the National CPI ex Fresh food arrived at 3.2% YoY in January versus 3.0% prior. The figure was above the market consensus of 3.1%.

CPI ex Fresh Food, Energy rose 2.5% YoY in January, compared to the previous reading of 2.4%.

Market reaction to Japan’s National CPI data

Following Japan’s CPI inflation data, the USD/JPY pair is down 0.13% on the day at 149.46.

Japanese Yen FAQs

What key factors drive the Japanese Yen?

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.

How do the decisions of the Bank of Japan impact the Japanese Yen?

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.

How does the differential between Japanese and US bond yields impact the Japanese 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.

How does broader risk sentiment impact the Japanese Yen?

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.

23:48

Japan National CPI ex Food, Energy (YoY) climbed from previous 2.4% to 2.5% in January

23:48

Japan National CPI ex Fresh Food (YoY) came in at 3.2%, above expectations (3.1%) in January

23:48

Japan National Consumer Price Index (YoY) increased to 4% in January from previous 3.6%

23:35

EUR/USD holds steady near 1.0500 ahead of Eurozone PMI release EURUSD

EUR/USD flat lines around 1.0500 in Thursday’s late American session.
US Initial Jobless Claims rose last week.
Trump’s tariff threats and the ECB’s dovish stance might drag the Euro lower.

The EUR/USD pair trades flat near 1.0500 during the late American session on Thursday. However, Trump’s tariff threats might weigh on the Euro (EUR) against the Greenback. Later on Friday, the advanced HCOB Manufacturing and Services PMIs in Germany and the euro bloc will be released.

US Initial Jobless Claims for the week ending February 15 rose to 219K, compared to the previous week's revised tally of 214K (from 213K), the US Department of Labor (DoL) showed Thursday. This figure came in above the market consensus of 215K. The reports have not changed expectations that the Federal Reserve (Fed) will remain on hold for several months.

Meanwhile, Trump said on Wednesday he will announce fresh tariffs within the next month, adding lumber and forest products to previously announced plans to impose duties on imported cars, semiconductors and pharmaceuticals. Trump's latest tariff plans might trigger fears of trade tension, which undermine the Euro in the near term.

Additionally, the rising bets of further interest rate reductions from the European Central Bank (ECB) could contribute to the EUR’s downside. Analysts expect the European Central Bank (ECB) to deliver quarter-point cuts at every meeting until mid-2025. That would bring the deposit rate to 2.0%

Euro FAQs

What is the Euro?

The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).

What is the ECB and how does it impact the Euro?

The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.

How does inflation data impact the value of the Euro?

Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.

How does economic data influence the value of the Euro?

Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.

How does the Trade Balance impact the Euro?

Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

23:12

Fed’s Kugler: Central bank should hold policy rate in place for some time

Federal Reserve Board Governor Adriana Kugler said late Thursday that US inflation still has "some way to go" to reach the central bank's 2% target and that its path toward that goal continues to be bumpy, per Reuters.

Key quotes

I see this as appropriate, given that the downward risks to employment have diminished but upside risks to inflation remain.

The potential net effect of new economic policies remains highly uncertain and will depend on the breadth, duration, reactions to, and, importantly, specifics of the measures adopted.

Going forward, in considering the appropriate federal funds rate, we will watch these developments closely and continue to carefully assess the incoming data and evolving outlook.

Market reaction

At the time of writing, the US Dollar Index (DXY) is trading 0.02% lower on the day to trade at 106.33.

Fed FAQs

What does the Federal Reserve do, how does it impact the US Dollar?

Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.

How often does the Fed hold monetary policy meetings?

The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.

What is Quantitative Easing (QE) and how does it impact USD?

In extreme situations, the Federal Reserve may resort to a policy named 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 during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.

What is Quantitative Tightening (QT) and how does it impact the US Dollar?

Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.

22:59

RBA’s Bullock: Board remains cautious about prospects for further policy easing

Reserve Bank of Australia Governor Michele Bullock said late Thursday that the central projection suggests that if monetary policy is eased too quickly or by too much, disinflation could stall and inflation would settle above the midpoint.

Key quotes

The board is committed to being guided by the incoming data and our evolving assessment of the risks.
While the strong employment growth is good news for jobseekers, we are alert to the possibility that it is signaling a bit more strength in the economy.
We have not pre-committed to any particular course of action on interest rates.
Satisfied with the progress on inflation so far – though our job is definitely not done.
The central projection suggests that if monetary policy is eased too quickly or by too much, disinflation could stall and inflation would settle above the midpoint of the target range.
So the board remains cautious about prospects for further policy easing.
The economic outlook remains uncertain.
We have made good progress on inflation, however, the board needs to be confident that it is returning to the target range sustainably.

Market reaction

At the press time, the AUD/USD pair was down 0.08% on the day to trade at 0.6398.

Australian Dollar FAQs

What key factors drive the Australian Dollar?

One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.

How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?

The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.

How does the health of the Chinese Economy impact the Australian Dollar?

China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.

How does the price of Iron Ore impact the Australian Dollar?

Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.

How does the Trade Balance impact the Australian Dollar?

The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.

22:40

Australia's Judo Bank Manufacturing PMI rises to 50.6 in February, Services PMI improves to 51.4

The preliminary reading of Australia's Judo Bank Manufacturing Purchasing Managers Index (PMI) rose to 50.6 in February from 50.2 in January, the latest data published by Judo Bank and S&P Global showed on Friday.

The Judo Bank Australian Services PMI improved to 51.4 in February from the previous reading of 51.2, while the Composite PMI increased to 51.2 in February versus 51.1 prior.

Market reaction

At the press time, the AUD/USD pair was down 0.11% on the day to trade at 0.6395.

Australian Dollar FAQs

What key factors drive the Australian Dollar?

One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD.

How do the decisions of the Reserve Bank of Australia impact the Australian Dollar?

The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive.

How does the health of the Chinese Economy impact the Australian Dollar?

China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs.

How does the price of Iron Ore impact the Australian Dollar?

Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD.

How does the Trade Balance impact the Australian Dollar?

The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.

22:03

Australia Judo Bank Manufacturing PMI up to 50.6 in February from previous 50.2

22:01

Australia Judo Bank Services PMI rose from previous 51.2 to 51.4 in February

22:01

Australia Judo Bank Composite PMI increased to 51.2 in February from previous 51.1

21:57

Gold price extended gains on trade war fears, soft US Dollar

Gold rises 0.23% as risk aversion fuels safe-haven flows.
Fed Minutes highlight inflation concerns amid Trump’s trade policies.
Traders eye S&P Global Flash PMIs for further market direction.

Gold's price advanced late in the North American session yet traded off record highs of $2,954 as traders took profits. Trade war woes, a weak US Dollar, and falling US Treasury bond yields kept XAU/USD trading with modest gains of 0.23% near the $2,939 mark at the time of writing.

Bullion’s demand remains fueled by uncertainty about global trade. Risk aversion sparked flows toward the safe-haven appeal of Gold alongside the Japanese Yen (JPY), which posted substantial gains during the day.

The Federal Reserve’s (Fed) Meeting Minutes from Wednesday revealed that Trump’s trade and immigration policies fueled concerns over rising prices. Hence, the Fed Chair Jerome Powell and Co. decided to hold rates unchanged at the January meeting as they assess the current economic data.

In the meantime, some Fed speakers crossed the wires and have turned slightly cautious. Atlanta Fed President Raphael Bostic sees two rate cuts this year and emphasizes that the economy is not facing a new burst of inflation. St. Louis Fed President Alberto Musalem sees some policy shifts and increased risks of inflation stalling above the Fed’s 2% goal.

Finally, Chicago’s Fed President Austan Goolsbee said that before the recent policy and geopolitical uncertainties, overall inflation "looked pretty good" and was down substantially. However, Trump's broad-based and higher tariffs currently in development keep the Fed nervous.

Data-wise, US job data was softer than expected as the number of Americans filling out unemployment benefits came below estimates. On Friday, Gold traders are eyeing the release of S&P Global Flash PMIs.

Daily digest market movers: Gold price boosted by Trump’s tariff threats fueling safe-haven demand

US President Donald Trump recently announced that tariffs on cars, automobiles, and computer chips would be around 25%. He also said on Wednesday that duties would broaden to other commodities like lumber.
US Initial Jobless Claims for the week ending February 15 increased by 219K, exceeding forecasts of 215K.
The US 10-year Treasury bond yield falls three basis points (bps) and yields 4.505%.
US real yields, which correlate inversely to Bullion prices, drop three basis points to 2.04%, a tailwind for Bullion prices.
The World Gold Council revealed that central bank purchases rose more than 54% YoY to 333 tonnes following Trump’s victory, according to its data.
Money market fed funds futures are pricing in 41.5 basis points of easing by the Fed in 2025.

XAU/USD technical outlook: Gold price faces stir resistance and retreats

Gold price uptrend remains intact, even though it has failed to decisively clear the $2,950 figure, opening the door for a pullback. Momentum shows overstretched as the Relative Strength Index (RSI) exited from overbought conditions, suggesting that sellers are gathering momentum.

In that outcome, the first support would be the February 14 swing low of $2,877, followed by the February 12 daily low of $2,864.

On the other hand, if XAU/USD rises past $2,954, the first resistance would be the psychological $2,950, followed by $3,000.

Gold FAQs

Why do people invest in Gold?

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.

Who buys the most Gold?

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.

How is Gold correlated with other assets?

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.

What does the price of Gold depend on?

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.