The post Ex-Dividend 26/2/2025 first appeared on IC Markets | Official Blog.

Trump will participate in a Cabinet Meeting at 11am US Eastern time.

He will be signing further executive orders at 3pm US Eastern time.

This article was written by Eamonn Sheridan at www.forexlive.com.

DXY (US Dollar Index):

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head toward the 1st resistance.

Pivot: 106.20
Supporting reasons: Identified as a multi-swing low support, indicating a potential area where price could rebound.

1st support: 105.69
Supporting reasons: Identified as a support that aligns with the 161.8% Fibonacci extension, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 106.84
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance. 

Pivot: 1.0442
Supporting reasons: Identified as an overlap support that aligns with the 61.8% Fibonacci retracement, indicating a potential level where buyers could step in.

1st support: 1.0345
Supporting reasons: Identified as a pullback support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 1.0585
Supporting reasons: Identified as a multi-swing high resistance that aligns close to the 100% Fibonacci projection and the 161.8% Fibonacci extension, forming a Fibonacci confluence that could act as a key resistance level.

EUR/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 155.94
Supporting reasons: Identified as a multi-swing low support, indicating a potential area where price could rebound.

1st support: 153.99
Supporting reasons: Identified as a support that aligns with the 127.2% Fibonacci extension, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 158.57
Supporting reasons: Identified as an overlap resistance that aligns with the 50% Fibonacci retracement, indicating a potential level where price could face selling pressure.

EUR/GBP:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a short-term rise toward the pivot before reversing off it and dropping toward the 1st support.

Pivot: 0.8313
Supporting reasons: Identified as a pullback resistance that aligns with the 50% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 0.8263
Supporting reasons: Identified as a multi-swing low support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 0.8357
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

GBP/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 1.2623
Supporting reasons: Identified as an overlap support, indicating a potential area where buyers could step in.

1st support: 1.2521
Supporting reasons: Identified as a pullback support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 1.2719
Supporting reasons: Identified as an overlap resistance that aligns with the 100% Fibonacci projection and the 127.2% Fibonacci extension, forming a Fibonacci confluence that could act as a key resistance level.

GBP/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a short-term rise toward the pivot before reversing and falling toward the 1st support.

Pivot: 190.68
Supporting reasons: Identified as an overlap resistance that aligns with the 50% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 187.74
Supporting reasons: Identified as a swing low support, indicating a potential level where price could stabilize before continuing higher.

1st resistance: 193.06
Supporting reasons: Identified as a multi-swing high resistance, indicating a potential level where price could face selling pressure.

USD/CHF:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially drop further to the pivot in the short term before bouncing from there and rising to the 1st resistance.

Pivot: 0.8901
Supporting reasons: Identified as an overlap support that aligns with the 61.8% Fibonacci retracement and the 78.6% Fibonacci projection, forming a strong Fibonacci confluence where price could find support.

1st support: 0.8799
Supporting reasons: Identified as a pullback support,  indicating a potential level where price could face selling pressure.

1st resistance: 0.8972
Supporting reasons: Identified as an overlap resistance, indicating a potential level where price could face selling pressure.

USD/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.

Pivot: 148.83
Supporting reasons: Identified as an overlap support that aligns with the 161.8% Fibonacci extension, indicating a strong level where buyers could step in. Additionally, The RSI is displaying bearish divergence versus price, suggesting that a reversal might occur soon, which could indicate a weakening of the bullish momentum.

1st support: 146.90
Supporting reasons: Identified as a pullback support that aligns with the 100% Fibonacci projection, suggesting a potential area where price could stabilize before resuming its upward movement.

1st resistance: 150.93
Supporting reasons: Identified as a pullback resistance, indicating a potential level where price could face selling pressure.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Neutral

Price is rising towards the pivot and could potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 1.4359

Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area where selling pressures could intensify.

1st support: 1.4261
Supporting reasons: Identified as an overlap support, indicating a key level where the price could stabilize once more.

1st resistance: 1.4488
Supporting reasons: Identified as a swing-high resistance that aligns close to a 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.6323

Supporting reasons: Identified as an overlap support that aligns close to a 23.6% Fibonacci retracement, indicating a potential area where buying interests could pick up to resume the uptrend. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 0.6260

Supporting reasons: Identified as a swing-low support that aligns close to a 50% Fibonacci retracement, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6402
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.5693

Supporting reasons: Identified as an overlap support that aligns close to a 50% Fibonacci retracement, indicating a potential area where buying interests could pick up to resume the uptrend. The presence of the green Ichimoku Cloud adds further significance to the strength of the bullish momentum.

1st support: 0.5665

Supporting reasons: Identified as a pullback support that aligns with a 61.8% Fibonacci retracement, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.5750

Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 43,840.73

Supporting reasons: Identified as a pullback resistance that aligns close to a 23.6% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 43,352.42

Supporting reasons: Identified as an overlap support, indicating a potential level where the price could stabilize once again.

1st resistance: 44,395.00

Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could rise towards the pivot and potentially make a bearish reversal off this level to pull back towards the 1st support.

Pivot: 22,867.00

Supporting reasons: Identified as a swing-high resistance that aligns close to the all-time high, indicating a potential area where selling pressures could intensify.

1st support: 22,163.30

Supporting reasons: Identified as a swing-low support that aligns with a 23.6% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 23,446.41
Supporting reasons: Identified as a resistance that aligns with a 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 6,043.80

Supporting reasons: Identified as a swing-high resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 5,918.31

Supporting reasons: Identified as a multi-swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 6,097.10

Supporting reasons: Identified as an overlap resistance that aligns with a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 90,732.57

Supporting reasons: Identified as a pullback resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 86,424.63
Supporting reasons: Identified as a multi-swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 94,030.59
Supporting reasons: Identified as a pullback resistance that aligns close to a 61.8 Fibonacci retracement, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 2,622.94

Supporting reasons: Identified as a pullback resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 2,360.08
Supporting reasons: Identified as a multi-swing-low support that aligns close to a 61.8% Fibonacci retracement, indicating a potential level where the price could stabilize once again.

1st resistance: 2,855.60
Supporting reasons: Identified as a multi-swing high resistance that aligns close to a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could rise towards the pivot and potentially make a bearish reversal off this level to fall towards the 1st support.

Pivot: 70.11

Supporting reasons: Identified as a pullback resistance that aligns close to a 23.6% Fibonacci retracement, indicating a potential area where selling pressures could intensify. The presence of the red Ichimoku Cloud adds further significance to the strength of the bearish momentum.

1st support: 67.22
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 71.08
Supporting reasons: Identified as a swing-high resistance that aligns close to a 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bearish
Overall momentum of the chart: Bullish
Price could potentially make a bearish reversal off the pivot and fall toward the 1st support.

Pivot: 2929.13
Supporting reasons: Identified as a pullback resistance that aligns with the 61.8% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 2882.38
Supporting reasons: Identified as an overlap support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 2956.116
Supporting reasons: Identified as a swing high resistance, indicating a potential level where price could face selling pressure.

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The post Wednesday 26th February 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

• China not happy with Canada – disrupt international trade rules, harm global supply chain
• Nomura’s time-zone analysis for USD/JPY
• Bank of England Monetary Policy Committee external member Dhingra speaking Wednesday
• Japan Post plans $4 bn share sale in Japan Post Bank
• Bitcoin forecast to drop into low 80K area
• China’s Vice Commerce Minister has met with US business leaders
• Tesla begins deliveries of updated Model Y in China
• The US House has passed the Republican Budget plan, advancing Trump’s tax plans
• PBOC sets USD/ CNY central rate at 7.1732 (vs. estimate at 7.2526)
• Copper – Chile restoring electricity supply
• Australian monthly CPI (January 2025) 2.5% y/y (vs. 2.6% expected)
• Australian data – Q4 2024 Construction Work Done +0.5% q/q vs. 1.0% expected
• Japan’s Nikkei expected to rise as high as 42,500
• ICYMI – Chile’s nationwide power outage – has impacted copper operations
• Bank of Korea’s rate cut reflects growing deflation risks
• Africa – Government efforts to prop up the price of cobalt
• Forexlive Americas FX news wrap: US consumer confidence sinks, drags down risk assets
• Oil – private survey of inventory shows a headline crude oil draw vs. build expected
• Trump says it possible he’ll allow Russian oligarchs Residency in the US
• Trade ideas thread – Wednesday, 26 February, insightful charts, technical analysis, ideas
• Trump indicates there will be a need for boots on the ground in Ukraine
• Lutnick says ‘its time for copper to come home’ – no exemptions, no exceptions

The
monthly inflation data always needs to be read with care (more on why
in the posts above). The January data today showed headline inflation
coming in at 2.5% y/y, a touch below median estimates, in line with
the previous month’s reading, and bang on the mid-point of the
Reserve Bank of Australia 2 – 3% target band, Its this mid-point
that the Bank and the government have agreed to as a target. The core
reading, Trimmed Mean, however, was higher at 2.8%, up from
December’s 2.7%.

The
details in the data are not indicative of another Reserve Bank of
Australia rate cut any time soon., The Bank will be eyeing the
‘official’ quarterly data due in late April.

The
AUD moved more or less inline with other major FX, initially ticking
a little stronger
against the USD before dropping away.

JPY
tracked a similar pattern, with USD/JPY seeing lows under 148.70
briefly before recovering to circa 149.50.

In
US political news Trump scored a big win for his 2025 agenda, with
the US House passing the budget bill that includes extending Trump’s
2017 tax cuts, provisions for deportation funding, stricter border
security, energy deregulation, and increased military spending.

Chinese
equities, both mainland and in Hong Kong had a strong session.

This article was written by Eamonn Sheridan at www.forexlive.com.

IC Markets Asia Fundamental Forecast | 26 February 2025

What happened in the U.S. session?

The backdrop of the ongoing trade tensions between the U.S. and its major trading partners is sapping confidence among American consumers as the Conference Board’s latest survey highlighted this pessimism. The index dropped sharply from 105.3 in the previous month to 98.3 in February to mark the third consecutive month of decline as views of current labour market conditions weakened. Consumers also became pessimistic about future business conditions and less optimistic about future income. Demand for the greenback waned on Tuesday as the dollar index (DXY) fell nearly 0.5% to hit an overnight low of 106.18. This index stabilized around 106.20 at the beginning of Wednesday’s Asia session but overhead pressures remain intact,

What does it mean for the Asia Session?

After accelerating from October’s low of 2.1% to as high as 2.5% in December, inflationary pressures in Australia appear to be moderating – the monthly CPI indicator remained unchanged at an annual rate of 2.5% in January. However, food prices increased the most in three months while housing inflation notched a five-month peak. The Aussie was hovering around 0.6330 following the release of this inflation metric and it is likely to remain supported as the day progresses.

The Bank of Japan (BoJ) will release its core CPI data for January where this metric is anticipated to accelerate for the third month in a row. After easing to an annual rate of 1.5% in October, the BoJ core CPI is forecast to increase to 2.0%. Should inflationary pressures continue to press higher, it reinforces this central bank’s stance on its hawkish tilt and raises the probability of another rate hike in March. Demand for the yen has been robust driving USD/JPY under 149 overnight.

The Dollar Index (DXY)

Key news events today

New Home Sales (3:00 pm GMT)

What can we expect from DXY today?

Sales of new single-family homes rose by 3.6% MoM in December to a seasonally adjusted annualized rate of 698k, the most since September and firmly above market expectations of 670k. This upward momentum in home sales could continue in January as benchmark mortgage rates have eased from January’s high of 7.04% for the 30-year fixed-rate mortgage, potentially nudging would-be buyers from the sidelines. Stronger-than-expected sales could provide a much-needed lift for the dollar.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 29 January.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance. The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
• Recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilized at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• December’s Summary of Economic Projections (SEP) now indicates just two rate cuts in 2025 totalling 50 bps, compared to the full percentage point of reductions projected in the previous quarter.
• GDP growth forecasts were revised upward for 2024 (2.5% vs. 2% in the September projection) and 2025 (2.1% vs. 2%), while remaining steady at 2% for 2026. Similarly, PCE inflation projections have been adjusted higher for 2024 (2.4% vs. 2.3%), 2025 (2.5% vs. 2.1%), and 2026 (2.1% vs. 2%).
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
• The Committee will roll over at auction the amount of principal payments from the Federal Reserve’s holdings of Treasury securities maturing in each calendar month that exceeds a cap of $25 billion per month and redeem Treasury coupon securities up to this monthly cap and Treasury bills to the extent that coupon principal payments are less than the monthly cap.
• In addition, the Committee will reinvest the amount of principal payments from the Federal Reserve’s holdings of agency debt and agency mortgage-backed securities (MBS) received in each calendar month that exceeds a cap of $35 billion per month into Treasury securities to roughly match the maturity composition of Treasury securities outstanding.
• The next meeting runs from 18 to 19 March 2025.

Next 24 Hours Bias

Medium Bearish

Gold (XAU)

Key news events today

New Home Sales (3:00 pm GMT)

What can we expect from Gold today?

Sales of new single-family homes rose by 3.6% MoM in December to a seasonally adjusted annualized rate of 698k, the most since September and firmly above market expectations of 670k. This upward momentum in home sales could continue in January as benchmark mortgage rates have eased from January’s high of 7.04% for the 30-year fixed-rate mortgage, potentially nudging would-be buyers from the sidelines. Stronger-than-expected sales could provide a much-needed lift for the dollar and potentially place gold prices under pressure.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

CPI (12:30 am GMT)

What can we expect from AUD today?

After accelerating from October’s low of 2.1% to as high as 2.5% in December, inflationary pressures in Australia appear to be moderating – the monthly CPI indicator remained unchanged at an annual rate of 2.5% in January. However, food prices increased the most in three months while housing inflation notched a five-month peak. The Aussie was hovering around 0.6330 following the release of this inflation metric and it is likely to remain supported as the day progresses.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 January, marking the first rate cut since November 2020.
• Financial conditions are restrictive, which is weighing on demand and is helping to bring down underlying inflation; growth in private demand has been subdued.
• Underlying inflation has moderated over the past three quarters with trimmed mean inflation easing to 3.2% over 2024 and it is expected to reach the 2–3% target range in early 2025, which is sooner than expected at the time of the November Statement.
• The unemployment rate declined a little in late 2024 to 4% with much of the strength in the labour market underpinned by strong employment growth, which has also bolstered household incomes.
• The announcement of tariffs between the United States and other major economies poses challenges to the global outlook but the scale and incidence of the tariffs and their effects remain highly uncertain – which may itself delay some investment until the outlook becomes clearer.
• Economic activity strengthened in China but growth there is still facing structural headwinds while domestic economic growth is forecast to pick up and the labour market is forecast to remain tight.
• If the cash rate follows the market path, underlying inflation is projected to be a little above 2.5% over most of the forecast period. The anticipated recovery of GDP growth and lingering tightness in labour market conditions are expected to sustain some upward pressure on inflation.
• Sustainably returning inflation to target within a reasonable timeframe remains the Board’s highest priority. This is consistent with the RBA’s mandate for price stability and full employment.
• The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions, paying close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
• The next meeting is on 1 April 2025.

Next 24 Hours Bias

Weak Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

With no major data releases in New Zealand, the Kiwi will likely take cue from its Pacific neighbour following the release of January’s consumer inflation in Australia. This currency pair was floating around 0.5720 as Asian markets came online.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 50 basis points bringing it down to 3.75% on 19 February, marking the fourth consecutive rate cut.
• The Committee assessed that annual consumer price inflation remains near the midpoint of the MPC’s 1 to 3% target band; inflation expectations are at target and core inflation continues to fall towards the target mid-point.
• Economic activity in New Zealand remains subdued and with spare productive capacity, domestic inflation pressures continue to ease. Price and wage-setting behaviours are adapting to a low-inflation environment while the price of imports has fallen, also contributing to lower headline inflation.
• Economic growth is expected to recover during 2025 as lower interest rates will encourage spending, although elevated global economic uncertainty is expected to weigh on business investment decisions. Higher prices for some key commodities and a lower exchange rate will increase export revenues and employment growth is expected to pick up in the second half of the year as the domestic economy recovers.
• Global economic growth is expected to remain subdued in the near term as geopolitics, including uncertainty about trade barriers, is likely to weaken global growth. Global economic activity is also likely to remain fragile over the medium term given increasing geoeconomic fragmentation.
• Consumer price inflation is expected to be volatile in the near term, due to a lower exchange rate and higher petrol prices. Nevertheless, the Committee is well placed to maintain price stability over the medium term.
• The economic outlook remains consistent with inflation remaining in the band over the medium term, giving the Committee confidence to continue lowering the OCR. If economic conditions continue to evolve as projected, the Committee has scope to lower the OCR further through 2025.
• The next meeting is on 9 April 2025.

Next 24 Hours Bias

Weak Bullish

The Japanese Yen (JPY)

Key news events today

BoJ Core CPI (5:00 am GMT)

What can we expect from JPY today?

The Bank of Japan (BoJ) will release its core CPI data for January where this metric is anticipated to accelerate for the third month in a row. After easing to an annual rate of 1.5% in October, the BoJ core CPI is forecast to increase to 2.0%. Should inflationary pressures continue to press higher, it reinforces this central bank’s stance on its hawkish tilt and raises the probability of another rate hike in March. Demand for the yen has been robust driving USD/JPY under 149 overnight.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 24 January, by an 8-1 majority vote, to set the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
• Japan’s economy has recovered moderately, although some weakness has been seen in part. Exports and industrial production have been more or less flat while corporate profits have been on an improving trend and business sentiment has stayed at a favourable level.
• The employment and income situation has improved moderately while private consumption has been on a moderately increasing trend despite the impact of price rises and other factors.
• On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been at around 3% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a pass-through to consumer prices of cost increases led by the past rise in import prices have waned.
• Inflation expectations have risen moderately while underlying CPI inflation has been increasing gradually toward the price stability target of 2%. With wages continuing to rise, there has been an increase in moves to reflect higher costs, such as increased personnel expenses and distribution costs, in selling prices.
• Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
• The next meeting is on 19 March 2025.

Next 24 Hours Bias

Weak Bullish

The Euro (EUR)

Key news events today

No major news events.

What can we expect from EUR today?

Despite Germany’s economy contracting by 0.2% QoQ in the second quarter of 2024 due primarily to declining exports and sluggish household consumption growth, the Euro remained well supported. The latest reading marked six consecutive quarters of contraction but the optimism brewing from the nation’s recent election results had overshadowed Tuesday’s poor GDP report. The Euro climbed above 1.0500 and it looks set to edge higher on Wednesday.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 30 January to mark the fourth successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.90%, 3.15% and 2.75% respectively.
• The disinflation process is well on track and inflation is set to return to the Governing Council’s 2% medium-term target in the course of this year. Most measures of underlying inflation suggest that inflation will settle at around the target on a sustained basis.
• Staff see headline inflation averaging 2.4% in 2024, 2.1% in 2025, 1.9% in 2026 and 2.1% in 2027 when the expanded EU Emissions Trading System becomes operational. For inflation excluding energy and food, staff project an average of 2.9% in 2024, 2.3% in 2025 and 1.9% in both 2026 and 2027.
• Staff now expect a slower economic recovery than in the September projections. Although growth picked up in the third quarter of this year, survey indicators suggest it has slowed in the current quarter – the economy is expected to grow by 0.7% in 2024, 1.1% in 2025, 1.4% in 2026 and 1.3% in 2027.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises sustainably at its 2% target over the medium term and to preserve the smooth functioning of monetary policy transmission.
• The next meeting is on 6 March 2025.

Next 24 Hours Bias

Medium Bullish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

The franc saw strong inflows on Tuesday as USD/CHF fell over 0.5%, slipping towards 0.8900, as new tariffs imposed by the U.S. on Canada and Mexico triggered a demand for this safe-haven currency. Overhead pressures are mounting for this currency pair and a break below 0.8900 is inevitable.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 50 basis points, going from 1.00% to 0.50% on 12 December, marking the fourth consecutive reduction.
• Underlying inflationary pressure has decreased again this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected as it decreased from 1.1% in August to 0.7% in November; both goods and services contributed to this decline.
• In the shorter term, the new conditional inflation forecast is below that of September: 1.1% for 2024, 0.3% for 2025 and 0.8% for 2026, based on the assumption that the SNB policy rate is 0.5% over the entire forecast horizon.
• GDP growth in Switzerland was only modest in the third quarter of 2024 with growth in the services sector again somewhat stronger, while value added in manufacturing declined.
• There was a further slight increase in unemployment, and employment growth was subdued while the utilisation of overall production capacity was normal.
• The SNB anticipates GDP growth of around 1% this year while currently expecting growth of between 1.0% and 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 20 March 2025.

Next 24 Hours Bias

Medium Bearish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Demand for the pound remained robust on Tuesday as Cable rose nearly 0.4%, gaining slightly more than 40 pips in the process. With no tariffs targeted towards the U.K. thus far, the pound will likely continue its upward ascent on Wednesday.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 7 to 2 to reduce the Bank Rate by 25 basis points (bps) to bring it down to 4.50% on 6 February 2025, while two members preferred to reduce it by 50 bps.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• CPI inflation was 2.5% in 2024 Q4 as domestic inflationary pressures moderated but remained somewhat elevated while some indicators eased more slowly than expected. Higher global energy costs and regulated price changes are expected to push up headline CPI inflation to 3.7% in 2025 Q3, even as underlying domestic inflationary pressures are expected to wane further.
• While CPI inflation is expected to fall back to around the 2% target thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.
• GDP growth has been weaker than expected at the time of the November Monetary Policy Report, and indicators of business and consumer confidence have declined – GDP growth is expected to pick up from the middle of this year.
• The labour market has continued to ease and is judged to be broadly in balance. Productivity growth has been weaker than previously estimated, and the Committee judges that growth in the supply capacity of the economy has weakened.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 8 May 2025.

Next 24 Hours Bias

Medium Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

With U.S. President Donald Trump confirming that tariffs on imports from Canada and Mexico will proceed as planned, the Loonie has come under pressure providing a strong lift for USD/CAD. This currency pair has risen over the last three consecutive trading days as it hit an overnight high of 1.4317 and it should remain supported as the day progresses.

Central Bank Notes:

• The Bank of Canada reduced its target for the overnight rate by 25 basis points bringing it down to 3% on 29 January; this marked the sixth consecutive meeting where rates were reduced.
• The bank announced its plan to complete the normalization of its balance sheet, ending quantitative tightening, and will restart asset purchases in early March, beginning gradually so that its balance sheet stabilizes and then grows modestly, in line with growth in the economy.
• Past cuts to interest rates have started to boost the economy and the recent strengthening in both consumption and housing activity is expected to continue. However, business investment remains weak while the outlook for exports is being supported by new export capacity for oil and gas.
• The Bank forecasts GDP growth will strengthen in 2025 and now projects GDP will grow by 1.8% in both 2025 and 2026, somewhat higher than potential growth.
• The labour market remains soft, with the unemployment rate at 6.7% in December. Job growth has strengthened in recent months, after lagging growth in the labour force for more than a year. Wage pressures, which have proven sticky, are showing some signs of easing.
• CPI inflation remains close to 2%, with some volatility due to the temporary suspension of the GST/HST on some consumer products. Shelter price inflation is still elevated but it is easing gradually, as expected.
• A broad range of indicators, including surveys of inflation expectations and the distribution of price changes among components of the CPI, suggests that underlying inflation is close to 2% with forecasts that CPI inflation will be around the 2% target over the next two years.
• With inflation around 2%, the economy in excess supply, and recent indicators tilted towards softer growth than projected, the Governing Council decided to reduce the policy rate a further 25 basis points to support growth and keep inflation close to the middle of the 1-3% target range.
• The cumulative reduction in the policy rate since last June is substantial as lower interest rates are boosting household spending and the economy is expected to strengthen gradually and inflation to stay close to target. However, if broad-based and significant tariffs were imposed, the resilience of Canada’s economy would be tested.
• The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
• The next meeting is on 12 March 2025.

Next 24 Hours Bias

Weak Bullish

Oil

Key news events today

EIA Crude Oil Inventories (3:30 pm GMT)

What can we expect from Oil today?

Despite the API report highlighting a surprise draw of 0.64M barrels of crude to buck a 5-week streak of higher inventories, it was insufficient to support oil prices on Tuesday as WTI oil dived 2.8% to hit an overnight low of $68.68 per barrel. With U.S. President Donald Trump confirming that tariffs on imports from Canada and Mexico would proceed as planned, it raised concerns about a potential trade war, which could lead to slower global growth and potentially dampen demand for crude oil. Looking at U.S. oil stocks once again, the EIA inventories have experienced four successive weeks of higher-than-anticipated builds, averaging 5.2M barrels of crude per week. Should the latest report point to another week of increasing inventories, it could function as a near-term bearish catalyst for this commodity later today.

Next 24 Hours Bias

Medium Bearish

The post IC Markets Asia Fundamental Forecast | 26 February 2025 first appeared on IC Markets | Official Blog.

China’s Commerce Ministry on Canada’s unilateral sanctions on Chinese firms:

• Canada’s unilateral sanctions on Chinese firms disrupt international trade rules and harm global supply chain stability.
• We urge Canada to immediately cease its wrongful actions.
• China to take necessary measures to safeguard the legal rights of Chinese companies.

Canada’s copping it from all over the place!

This article was written by Eamonn Sheridan at www.forexlive.com.

China’s Vice Commerce Minister has met with US business leaders. China International Trade Representative and Vice Minister of Commerce Wang Shouwe.

• discussing tariffs

Info via an announcement from China’s Ministry of Commerce.

No further details at this stage.

This article was written by Eamonn Sheridan at www.forexlive.com.

Tech Stocks Hit Again After Weak Data – Nasdaq Off 1.35%

US tech stocks took another hit in trading yesterday after Consumer Confidence numbers came in a lot lower than expected. The Dow pushed 0.37% higher, but the tech‐heavy S&P and Nasdaq suffered, losing 0.47% and 1.35% respectively. Treasury yields took another tumble and are well off highs seen just a few weeks ago; the 2‐year lost 7.4 basis points to move down to 4.094%, and the benchmark 10‐year fell 10.6 basis points to 4.294%. Oil prices took a hard hit as demand concerns increased – Brent off 2.11% to $73.20 and WTI down 2.50% to $68.93 a barrel – whilst gold dipped 1.19% to $2,916.59 as more profit‐taking flow hit the market.

Treasury Yields Could Push the Dollar Lower

FX traders will be keeping a close eye on US Treasury yields over the following days, as they have taken a beating in the last week with US data continuing to come in below expectations. Last night’s weaker‐than‐expected US Consumer Confidence data led to the benchmark 10‐year yield hitting its lowest level in 10 weeks as investors piled into treasuries. The uncertainty regarding President Trump’s policies – and particularly his tariff plans – is now filtering strongly through to US markets, and the pressure on yields could flow through onto the dollar. The contrarian view, however, is that this is just a clear‐out move, and tariff threats from just a day or so ago could lead to inflationary pressures and see yields rebound strongly – and with it, the dollar. Once again for many, it looks like more headline volatility ahead!

Event Calendar Picks Up for Traders Today

The event calendar has been relatively bare so far this week, and the impact of last night’s Consumer Confidence number in the US shows how much traders are now looking for fundamental data to back up recent moves. The event calendar does pick up from today and increases as we move through the week. The initial focus in the Asian session today will be on Australian markets, with the key CPI data due out early in the day – the expectation is for a 2.6% increase for the year-on-year data, and anything off this will see strong moves in the Aussie. There is little on the calendar in Europe, but we do have more data out from the US once New York opens; New Home Sales data is due out early in the day, before we then have the usual weekly US Crude Oil Inventory data.

The post General Market Analysis – 26/02/25 first appeared on IC Markets | Official Blog.

The Republican-controlled U.S. House of Representatives narrowly approved President Donald Trump’s tax and border policy package late Tuesday, giving his 2025 agenda a major boost.

The bill passed by a 217-215 vote

• one Republican opposing
• no Democratic support

Speaker Mike Johnson initially canceled the vote due to insufficient backing but later reversed course after extensive lobbying efforts by Johnson, House Majority Leader Steve Scalise, and Trump himself.

The $4.5 trillion package is a step toward extending Trump’s 2017 tax cuts and includes provisions for deportation funding, stricter border security, energy deregulation, and increased military spending. Trump actively urged lawmakers to support the measure, emphasizing its importance in shaping his policy priorities.

Big win for Trump.

This article was written by Eamonn Sheridan at www.forexlive.com.

Earlier:

• ICYMI – Chile’s nationwide power outage – has impacted copper operations

In some better news trickling out of the country, Chile’s National Electricity Coordinator says about a quarter of electrical demand has been restored to the grid.

Full recovery could happen by morning.

This article was written by Eamonn Sheridan at www.forexlive.com.

January 2025 monthly inflation CPI data from Australia

Comes in at 2.5 % y/y

• expected 2.6%, prior 2.5%

Trimmed mean: 2.8% y/y

• prior: 2.7%

That headline result is encouraging. Its under the median estimate and the same as the previous month. Its also bang in the centre of the Reserve Bank of Australia’s 2 – 3 % target band. The RBA and government have an agreement to target the midpoint, so all good on that score.

The niggle, of course, is that underlying measure, core, which in Australia is the trimmed mean. Its register and uptick. It still under 3%, so that’s a positive.

Of course, I don’t know haw many times I say this, the monthly figure doesn’t carry the weight of the official quarterly figure. For that we’ll have to wait until later in April. Still, January is what we have to go on and its net encouraging.

Now, despite all my blah, blah, blah, AUD/USD is barely changed – Circa 0.6351.

***

The monthly CPI data from Australia does not show all components of the CPI, that’ll have to wait for the quarterly data release (late in April).

• The monthly CPI indicator does, however, provide a timelier indication of inflation using the same data collected for use in the quarterly CPI. The monthly reading includes updated prices for between 62 and 73 per cent of the weight of the quarterly CPI basket, its not the full picture.

This article was written by Eamonn Sheridan at www.forexlive.com.

Australian data – Q4 2024 Construction Work Done

Comes in at % q/q

• expected +1.0%, prior +1.6%

more to come

***

Construction work done includes building work (residential and non – residential) and engineering work.

This article was written by Eamonn Sheridan at www.forexlive.com.