Currency Hedger No Comments

CAD sits near its highest level since March 11 vs USD amid elevated Oil prices

  • USD/CAD remains depressed as elevated Crude Oil prices continue to underpin the Loonie.
  • The Fed’s hawkish tilt and the US-Iran stalemate support the USD, limiting losses for the pair.
  • Spot prices seem poised to post losses for the fourth week as traders look to the US ISM PMI.

The USD/CAD pair enters a bearish consolidation phase after touching a fresh low since March 11 during the Asian session on Friday, and currently trades around the 1.3575 region. Nevertheless, spot prices remain on track to register losses for the fourth straight week.

Crude Oil prices stall the previous day’s retracement slide from a nearly four-week top amid persistent geopolitical uncertainties due to stalled US-Iran peace talks. In fact, US President Donald Trump rejected an Iranian proposal to open the Strait of Hormuz and lift the blockade, while postponing nuclear issues to a later stage. Trump further said that he’s going to keep Iran under a naval blockade until the regime agrees to a deal that addresses US concerns about its nuclear program.

Moreover, reports suggest that the US is considering new military strikes on Iran, which acts as a tailwind for the black liquid. This, in turn, is seen underpinning the commodity-linked Loonie and capping the USD/CAD pair. Meanwhile, the US Dollar (USD) recovers slightly following the overnight slump to a one-and-a-half week low amid the US-Iran stalemate and the Federal Reserve’s (Fed) hawkish tilt. This offers some support to the currency pair and helps limit the downside.

The Fed’s decision on Wednesday to hold its key policy rate unchanged at 3.50%-3.75% saw three policymakers voting against the accommodative tone in the policy statement. Adding to this, the Advance US GDP report released on Thursday pointed to continued economic resilience, while the US Personal Consumption Expenditures (PCE) Price Index showed that inflation accelerated in March. The data reaffirms bets that the Fed could keep rates unchanged and supports the USD.

Traders, however, are still pricing in a small possibility that the US central bank will lower borrowing costs by the end of this year. The expectations, in turn, hold the USD bulls on the back foot, warranting some caution before positioning for any meaningful recovery for the USD/CAD pair. Traders now look forward to the release of the US ISM Manufacturing PMI for some impetus heading into the weekend.

Currency Hedger No Comments

EUR/USD Price Holds onto gains near 1.1730

  • EUR/USD trades firmly near 1.1735 amid weakness in the US Dollar.
  • Investors await the ECB commentaries and the US ISM Manufacturing PMI data for April.
  • The US GDP growth remained at 2% on an annualized basis in the first quarter of the year.

The EUR/USD pair clings to Thursday’s gains near 1.1735 during the Asian trading session on Friday. The major currency pair reflects strength as the US Dollar (USD) holds onto the previous day’s losses, which were driven by suspected Japan’s intervention in forex markets.

During the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades weakly near Thursday’s low around 98.00.

On Thursday, the US preliminary Q1 Gross Domestic Product (GDP) data arrived weaker than projected. The US Bureau of Economic Analysis (BEA) reported that the economy grew at an annualized pace of 2%, slower than 2.3% estimates.

Meanwhile, investors await the US ISM Manufacturing PMI data for April, which will be published at 14:00 GMT. The Manufacturing PMI is expected to arrive higher at 53.0 from the previous reading of 52.7.

During the Asian trade, the Euro (EUR) trades broadly firm, with investors awaiting commentaries from a slew of European Central Bank (ECB) officials, following the completion of the so-called quiet period after the monetary policy announcement on Thursday.

USD/JPY technical analysis

EUR/USD trades firmly at around 1.1735, holding a mildly bullish bias as it sits above the 20-period exponential moving average (EMA) at 1.1702 and between key Fibonacci retracement levels of the latest swing. The pair is hovering just under the 50.0% retracement at 1.1745, suggesting topside progress is slowing but not yet reversing, while the Relative Strength Index (RSI) around 55 hints at constructive, yet not overextended, upside momentum.

On the topside, immediate resistance is located at the 50.0% Fibonacci retracement at 1.1745, followed by the 61.8% level at 1.1825, with further barriers at 1.1938 and 1.2082. On the downside, initial support is provided by the 20-period EMA at 1.1702, ahead of the 38.2% Fibonacci level at 1.1666; a deeper pullback would expose the 23.6% retracement at 1.1567, with the cycle low near 1.1408 acting as a more distant structural floor.

Currency Hedger No Comments

AUD/JPY Price Gains ground, maintaining bullish bias above 100-day EMA

  • AUD/JPY edges higher to around 113.10 in Friday’s early European session. 
  • The cross keeps a positive tone above the 100-day EMA, with the RSI pointing to neutral but slightly positive momentum. 
  • The immediate resistance level emerges at 113.30; the initial support level to watch is 111.10. 

The AUD/JPY cross holds positive ground near 113.10 during the early European session on Friday. The cross remains firm after pulling back from a multi-decade high of 114.72. However, the potential upside for AUD/JPY might be limited amid intervention fears. 

Atsushi Mimura, Japan’s Vice Finance Minister for International Affairs and top foreign exchange official, on Friday declined to confirm the Japanese Yen (JPY) intervention directly but delivered a pointed warning to speculators, noting that Japan’s Golden Week holidays have just started and that there is no change to his view that market moves remain speculative in nature. 

On the other hand, a hawkish stance from the Reserve Bank of Australia (RBA) could underpin the Aussie. Australian headline Consumer Price Index (CPI) inflation climbed to 4.6% YoY in March, primarily due to fuel price shocks linked to ongoing Middle East conflicts. While the figure was slightly below the 4.7% forecast, it remains well above the Reserve Bank of Australia’s (RBA) target range, keeping pressure on the central bank to hike rates. 

Chart Analysis AUD/JPY

Technical Analysis:

In the daily chart, AUD/JPY keeps a constructive bullish bias as it holds above the 100-day Exponential Moving Average (EMA) and the lower Bollinger Band. Price is testing the Bollinger 20-day simple moving average (SMA) pivot at 113.30, suggesting ongoing upside interest after the recent pullback, while the Relative Strength Index (RSI) around 52 points to neutral but slightly positive momentum rather than overbought conditions.

On the topside, a sustained break above the Bollinger mid-line at 113.30 would open the way toward the April 28 high of 114.72, en route to the upper Bollinger Band of 115.45. On the downside, initial demand is seen at the lower Bollinger Band near 111.10, ahead of stronger, medium-term support at the 100-day EMA around 109.30, where buyers would be expected to re-emerge if a deeper correction unfolds.

Currency Hedger No Comments

EUR/USD advances as ECB holds rates, mixed US data weigh on Dollar

  • EUR/USD advances despite a cautious ECB stance and unchanged rates.
  • Energy-driven inflation risks complicate the Eurozone outlook.
  • The US Dollar softens amid mixed US data and steady Fed expectations.

EUR/USD trades around 1.1690 on Thursday at the time of writing, up 0.11% on the day, after hitting a three-week low at 1.1655 earlier in the day.

The pair benefits from a weaker US Dollar (USD), as mixed economic indicators are weighing on the Greenback, notably US annualized Gross Domestic Product (GDP) growth coming in at 2% in the first quarter, below expectations of 2.3%, although significantly higher than the previous reading of 0.5%.

At the same time, inflation measured by the Personal Consumption Expenditures (PCE) Price Index reached 3.5% YoY in March, confirming persistent price pressures, while Initial Jobless Claims fell to 189K from a revised 215K in the previous week, pointing to continued resilience in the labor market. This mixed backdrop is maintaining uncertainty around the timing of the Federal Reserve’s (Fed) next policy moves.

Fed Chair Jerome Powell reiterated on Wednesday that the current policy stance remains appropriate, while highlighting that geopolitical tensions in the Middle East are adding to global uncertainty.

On the European side, the European Central Bank (ECB) left its key interest rates unchanged on Thursday, with the main refinancing rate at 2.15%, the marginal lending facility at 2.4%, and the deposit facility at 2%. The central bank noted that incoming data have been broadly in line with its projections, while warning that upside risks to inflation and downside risks to growth have intensified.

ECB President Christine Lagarde emphasized a data-dependent, meeting-by-meeting approach, noting that policymakers extensively debated a potential rate hike before unanimously deciding to hold rates steady. She also highlighted that rising energy prices could weigh on investment from both firms and households, amid elevated uncertainty and weakening confidence.

Although long-term inflation expectations remain well anchored around the 2% target, short-term expectations have risen significantly, particularly due to geopolitical tensions. This context reinforces the ECB’s cautious stance, as it prefers to wait for greater clarity before adjusting its monetary policy.

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 Euro.

USDEURGBPJPYCADAUDNZDCHF
USD-0.07%-0.25%-2.26%-0.12%-0.55%-0.67%-0.94%
EUR0.07%-0.14%-2.18%-0.05%-0.45%-0.57%-0.84%
GBP0.25%0.14%-2.03%0.10%-0.30%-0.42%-0.70%
JPY2.26%2.18%2.03%2.18%1.77%1.59%1.33%
CAD0.12%0.05%-0.10%-2.18%-0.43%-0.58%-0.82%
AUD0.55%0.45%0.30%-1.77%0.43%-0.12%-0.38%
NZD0.67%0.57%0.42%-1.59%0.58%0.12%-0.27%
CHF0.94%0.84%0.70%-1.33%0.82%0.38%0.27%

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).

Currency Hedger No Comments

Lagarde speaks on policy outlook after leaving key rates unchanged

Christine Lagarde, President of the European Central Bank (ECB), explains the ECB’s decision to leave key rates unchanged at the April policy meeting and responds to questions from the press.

ECB press conference key quotes

“Economy was showing momentum before current turbulence.”

“Domestic demand remains main driver of growth.”

“Outlook highly uncertain.”

“Incoming info suggests that conflict is weighing on activity.”

“Business less confident about future.”

“Supply chains coming under pressure.”

“High energy to weigh on incomes.”

“High energy costs to make firms, households reluctant to invest.”

“Labour demand has cooled further.”

“Households in solid financial position.”

“Favourable starting point provides some cushioning.”

“Fiscal responses should be temporary, targeted, tailored.”

“Indicators of underlying inflation have changed little in recent months.”

“Wage tracker indicates easing labour costs.”

“Surveys indicate rise in other costs.”

“Most measures of longer term inflation expectations stand around 2%.”

“Increase in energy prices will keep inflation well above 2% in near term.”

“Will closely monitor size and impact of energy price surge.”

“Risks to growth are tilted to the downside.”

“Worsening of global market sentiment could further dampen demand.”

“Risks to inflation are tilted to the upside.”

“Not going to say whether we’re closer to any particular scenario.”

“We are certainly moving away from baseline.”

“To where exactly? I’m not sure is the most relevant assessment.”

“Most critical is what impact energy prices will have.”

“Made an informed decision of yet insufficient info.”

“Debated at length various options.”

“Decision was unanimous.”

“Debated at length a hike.”

“Some governors may argue both sides of proposals.”

“Hard data is broadly in line with projections.”

“There is such uncertainty, we need to revisit all issues at next meeting.”

“Given position we’re at, six weeks will be the right time to assess developments.

Currency Hedger No Comments

USD/CAD edges lower as Oil retreat, Fed-BoC policy split keep volatility elevated

  • USD/CAD trades slightly lower at around 1.3655 after a flat day previously.
  • Declining Oil prices weigh on the Canadian Dollar, although structural support remains.
  • Diverging policy outlooks between the Fed and the BoC keep volatility elevated.

USD/CAD trades around 1.3655 on Thursday, down 0.21% on the day, after stabilizing in the previous day. The pair faces short-term pressure due to a modest pullback in the US Dollar, although downside momentum may remain limited in an uncertain macro environment.

The Canadian Dollar (CAD) shows resilience despite the recent decline in Oil prices, a key driver for the commodity-linked currency. West Texas Intermediate (WTI) is falling after several days of gains, trading around $103 per barrel, which typically weighs on the Loonie given Canada’s position as the largest Crude exporter to the United States (US). However, ongoing geopolitical tensions in the Middle East and potential supply disruptions continue to support the broader outlook for Canada’s energy sector.

On the monetary policy front, the Bank of Canada (BoC) kept its policy rate unchanged at 2.25% and adopted a wait-and-see stance while keeping options open. Governor Tiff Macklem emphasizes a data-dependent approach, noting that no preset path is in place. Inflation is projected slightly higher for 2026 and wage pressures remain persistent, limiting the scope for near-term easing. The central bank also signaled that trade shocks from the United States could justify rate cuts, while sustained energy-driven inflation could require tightening.

On the US side, the US Dollar (USD) corrects lower after two days of gains. The Federal Reserve (Fed) held rates within the 3.5%-3.75% range, with a divided vote reflecting rare internal disagreement. Chair Jerome Powell reiterated that inflation remains elevated, partly due to higher energy prices, reinforcing a broadly hawkish stance.

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 Canadian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD-0.26%-0.32%-2.00%-0.21%-0.52%-0.54%-0.67%
EUR0.26%-0.03%-1.69%0.05%-0.25%-0.25%-0.38%
GBP0.32%0.03%-1.62%0.09%-0.20%-0.21%-0.36%
JPY2.00%1.69%1.62%1.70%1.40%1.33%1.22%
CAD0.21%-0.05%-0.09%-1.70%-0.32%-0.35%-0.46%
AUD0.52%0.25%0.20%-1.40%0.32%-0.01%-0.13%
NZD0.54%0.25%0.21%-1.33%0.35%0.00%-0.13%
CHF0.67%0.38%0.36%-1.22%0.46%0.13%0.13%

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).

Currency Hedger No Comments

GBP faces pressure after BoE leaves interest rates unchanged at 3.75%, as expected

  • The Pound Sterling comes under pressure against its peers after the BoE’s interest rate decision.
  • The BoE maintains the status quo, leaving interest rates unchanged at 3.75%.
  • On Wednesday, the Fed held interest rates steady in the range of 3.50%-3.75%.

The Pound Sterling (GBP) faces selling pressure, prima facie, after the Bank of England’s (BoE) monetary policy announcement. As expected, the BoE has left interest rates unchanged at 3.75%, with an 8-1 majority. This is the third straight meeting that the BoE has maintained the status quo.

BoE Chief Economist Huw Pill was the one Monetary Policy Committee (MPC) member who dissented from the hold decision and voted for an interest rate hike. Pill was expected to advocate an interest rate hike, as he stated in an event in the middle of the month, that interest rates should be raised for inflation to return to the central bank’s 2% target.

The BoE needs to make decisions that give “the most insurance” against a repeat of the 2022 inflation shock, Pill argued, warning against a “wait and see approach,” Bloomberg reported.

Meanwhile, the US Dollar (USD) faces intense selling despite growing concerns over the Strait of Hormuz outlook and a hawkish Federal Reserve (Fed) hold.

United States (US) President Donald Trump stated on late Wednesday that Washington’s naval blockade of Iranian sea ports will continue until Iran gives up its nuclear ambitions.

On Wednesday, the Fed left interest rates unchanged at 3.50%-3.75%, however, three members of the rate-setting committee dissented the decision and advocated for a move away from the monetary easing bias.

Going forward, investors will focus on the US preliminary Gross Domestic Product (GDP) data, which will be published at 12:30 GMT. On an annualized basis, the US GDP growth is expected to have remained higher at 2.3% against the previous reading of 0.5%.