US Stocks Hit by Further Tariff Updates – Nasdaq Down 2.6%

US stock markets declined yesterday despite yet another reversal by President Trump on Canadian and Mexican tariffs. The Dow fell by 0.99%, the S&P 500 by 1.78%, while the Nasdaq led the downturn, dropping 2.61% on the day.

The dollar continued its recent plunge, reaching levels not seen since before the November election. The DXY ultimately closed 0.10% lower at 104.21. Treasury yields had a mixed session, with longer-dated yields rising while shorter-dated ones fell. The 2-year yield lost 4.6 basis points, dropping to 3.958%, while the benchmark 10-year yield closed flat at 4.278%.

Oil prices were volatile but ultimately ended the session close to flat, with Brent up 0.19% to $69.43 and WTI rising 0.08% to $66.36. Meanwhile, gold edged lower in a relatively tight range, losing 0.29% to close at $2,910.45.

Dollar in Focus Ahead of Non-Farm Payrolls

The dollar has suffered significant losses this week, with the DXY down more than 3.5% from Monday’s open to last night’s low, in what has largely been a one-way move. A major driver of this decline has been the euro, which has seen its strongest three-day rally in two years, supported by economic updates from Germany. Given that the euro makes up 57% of the DXY basket, its surge has significantly impacted the index.

Tonight’s Non-Farm Payrolls (NFP) report could prove pivotal in determining whether this sharp decline is merely a short-term correction following a realignment with US yields or whether further downside lies ahead for the greenback. If the jobs data indicate a slowdown in the US economy and reinforce expectations of interest rate cuts, the dollar’s slide could continue in the coming weeks. Conversely, a strong report could trigger a swift reversal of this week’s losses.

US Session in Focus for Traders Today

Today is shaping up to be a classic Non-Farm Payrolls trading day, with a few additional factors adding to the mix. The event calendar is relatively quiet during the first two trading sessions, with the only notable release being a speech from ECB President Christine Lagarde. However, the main focus will be on the US session.

At the New York open, attention will turn to the headline NFP print, which is expected to show an increase of 159,000 jobs last month. Alongside this, traders will be closely watching the Average Hourly Earnings data (expected to rise by 0.3% month-on-month) and the Unemployment Rate (expected at 4.0%). Any deviation from these forecasts is likely to trigger significant market moves.

Canadian employment data is also scheduled for release at the same time, but US figures are expected to drive overall market sentiment.

Adding another layer of potential volatility, several Federal Reserve officials, including Chair Jerome Powell, are scheduled to speak later in the day. In an unexpected addition, President Trump is also set to deliver remarks on cryptocurrency policy near the end of the session. With these events on the horizon, traders are bracing for heightened market volatility right through to the close.

The post General Market Analysis – 07/03/25 first appeared on IC Markets | Official Blog.

The post Ex-Dividend 7/3/2025 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei up 0.88%, Shanghai Composite up 0.88%, Hang Seng up 2.46% ASX down 0.57%
• Commodities : Gold at $2924.35 (0.09%), Silver at $33.15 (0.08%), Brent Oil at $69.5 (0.35%), WTI Oil at $66.68 (0.4%)
• Rates : US 10-year yield at 4.325, UK 10-year yield at 4.6720, Germany 10-year yield at 2.7830

News & Data:

• (USD) ADP Non-Farm Employment Change 77K  to 141K expected
• (CAD) Labor Productivity 0.6%  to 0.6% expected
• (USD) Final Services PMI 51.0  to 49.7 expected
• (USD) ISM Services PMI 53.5  to 52.5 expected

Markets Update:

Asia-Pacific markets mostly gained on Thursday, tracking Wall Street’s rebound after U.S. President Donald Trump postponed tariffs on certain automakers. Japan’s Nikkei 225 rose 1%, while the Topix climbed 1.3%. Japanese government bond yields surged, with the 10-year yield reaching its highest level since 2009, according to LSEG data. Meanwhile, South Korea’s Kospi gained 0.9%, while the small-cap Kosdaq slipped 0.75%. The country’s February consumer inflation rose 2% year-on-year, slightly above Reuters’ estimate of 1.95%, but lower than January’s 2.2% increase.

Hong Kong’s Hang Seng Index jumped 2.47% at the open, and mainland China’s CSI 300 added 0.6% following Beijing’s decision to raise its fiscal deficit to around 4% of GDP. This rare increase signals a notable shift in economic policy. However, Australia’s S&P/ASX 200 edged down 0.6%, making it an exception among regional markets.

The White House announced a one-month delay on tariffs for automakers that comply with the United States-Mexico-Canada Agreement. White House spokesperson Karoline Leavitt stated that Trump was open to additional tariff exemptions beyond the temporary pause on auto levies. The decision provided relief to global markets, particularly the automotive sector.

On Wall Street, stocks rebounded sharply. The Dow Jones Industrial Average jumped 485.60 points (1.14%) to close at 43,006.59, recovering from a two-day drop of more than 1,300 points. The S&P 500 added 1.12% to 5,842.63, while the Nasdaq Composite climbed 1.46% to 18,552.73, reflecting renewed investor optimism.

Upcoming Events: 

• 01:15 PM GMT – EUR Main Refinancing Rate
• 01:30 PM GMT – USD Unemployment Claims
• 01:45 PM GMT – EUR ECB Press Conference

The post Thursday 6th March 2025: Asia-Pacific Markets Rise as Wall Street Rebounds Amid Tariff Delay first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 6 March 2025

What happened in the Asia session?

It was a fairly quiet session as the dollar index (DXY) hovered around 104.25 while spot prices for gold stalled around $2,920/oz. With the ECB taking centre stage in the latter part of the day, trading activity and volume are likely to pick up in the second half of the European session.

What does it mean for the Europe & US sessions?

Construction activity in the U.K. fell sharply to 48.1 in January 2025 from 53.3 in December, missing market expectations of 53.4. The latest result signalled a contraction in overall industry output, ending a 10-month streak of sustained expansion, with firms citing the slowdown to delayed client decision-making on major projects and broader economic uncertainty. New business inflows – a sign of future demand – dropped for the first time in 12 months in January, which is likely to result in a second successive month of contraction when February’s report drops during the European trading hours.

After reducing their key interest rates by 25 basis points (bps) in January, the ECB is widely anticipated to make another 25-bps cut to mark the fifth consecutive meeting where rates were lowered – this would bring the main refinancing rate down to 2.65%. With economic activity in the Euro Area looking sluggish while the prospect of tariffs on EU exports to the U.S. grows stronger, the outlook for this region is bleak. ECB President Christine Lagarde commences her press conference half an hour after the release of the monetary statement and her remarks and replies to media questions will play a decisive role in the direction of the Euro.

The Ivey PMI had reported strong expansion from September through December 2024 but January’s report highlighted the first contraction in five months. This significant drop in output was attributed mainly to the ongoing trade tariffs between the U.S. and Canada, raising uncertainty and volatility for the Loonie. Should February’s results point to another month of contraction, selling pressures for the Loonie could intensify once again.

The Dollar Index (DXY)

Key news events today

Unemployment Claims (1:30 pm GMT)

Fed Governor Waller’s Speech (8:30 pm GMT)

What can we expect from DXY today?

Unemployment claims spiked last week as claims soared to 242k. Not only did the latest figures exceed market expectations of 221k, but they also registered the highest reading in over two months. Rising claims typically signal weakness for the U.S. labour market and it was evident in Wednesday’s soft DP employment report. Much later in the day, Federal Reserve Governor Christopher Waller will be speaking about the economic outlook at the Wall Street Journal CFO Network Summit in New York where audience questions are expected. His position as a Governor holds serious weight and his remarks could have a huge impact on financial markets in the latter part of the day.

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

Unemployment Claims (1:30 pm GMT)

Fed Governor Waller’s Speech (8:30 pm GMT)

What can we expect from Gold today?

Unemployment claims spiked last week as claims soared to 242k. Not only did the latest figures exceed market expectations of 221k, but they also registered the highest reading in over two months. Rising claims typically signal weakness for the U.S. labour market and it was evident in Wednesday’s soft DP employment report. Much later in the day, Federal Reserve Governor Christopher Waller will be speaking about the economic outlook at the Wall Street Journal CFO Network Summit in New York where audience questions are expected. His position as a Governor holds serious weight and his remarks could have a huge impact on financial markets in the latter part of the day.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

Following Wednesday’s strong rebound in economic activity in the final quarter of 2024, the Aussie saw strong gains. The Australian economy grew by 0.6% QoQ, exceeding the market consensus of 0.5%. It marked the 13th quarter of expansion and the fastest pace since Q4 2022, driven by a rebound in household spending, as expenditures on essentials like rent and healthcare continued to rise, and private investment. On the trade front, exports of goods and services both grew robustly. This currency pair rallied 1.4% on Wednesday and the upward momentum is likely to continue on Thursday.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 February, 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

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi soared almost 1.8% as it surged past 0.5700 on Wednesday, buoyed by intense selling in the greenback. This currency pair was rising strongly towards 0.5750 as Asian markets came online on Thursday.

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

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

Demand for the yen remained robust as markets accepted the reality of the Bank of Japan’s hawkish stance going into the central bank meeting on 19th March. The stronger yen drove USD/JPY to an overnight low of 148.38 and this currency pair is likely to face strong headwinds this week.

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 Bearish

The Euro (EUR)

Key news events today

ECB Interest Rate Decision (1:15 pm GMT)

ECB Press Conference (1:45 pm GMT)

What can we expect from EUR today?

After reducing their key interest rates by 25 basis points (bps) in January, the ECB is widely anticipated to make another 25-bps cut to mark the fifth consecutive meeting where rates were lowered – this would bring the main refinancing rate down to 2.65%. With economic activity in the Euro Area looking sluggish while the prospect of tariffs on EU exports to the U.S. grows stronger, the outlook for this region is bleak. ECB President Christine Lagarde commences her press conference half an hour after the release of the monetary statement and her remarks and replies to media questions will play a decisive role in the direction of the Euro.

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?

With inflationary pressures dissipating even further in February, demand for the franc could begin to wane. After hitting a low of 0.8857 on Wednesday, USD/CHF stabilised to rise higher following the release of Switzerland’s consumer inflation. This currency pair climbed above 0.8900 at the beginning of the Asia session and could continue to grind higher as the day progresses.

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

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Construction PMI (9:30 am GMT)

What can we expect from GBP today?

Construction activity in the U.K. fell sharply to 48.1 in January 2025 from 53.3 in December, missing market expectations of 53.4. The latest result signalled a contraction in overall industry output, ending a 10-month streak of sustained expansion, with firms citing the slowdown to delayed client decision-making on major projects and broader economic uncertainty. New business inflows – a sign of future demand – dropped for the first time in 12 months in January, which is likely to result in a second successive month of contraction when February’s report drops during the European trading hours.

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

Ivey PMI (3:00 pm GMT)

What can we expect from CAD today?

The Ivey PMI had reported strong expansion from September through December 2024 but January’s report highlighted the first contraction in five months. This significant drop in output was attributed mainly to the ongoing trade tariffs between the U.S. and Canada, raising uncertainty and volatility for the Loonie. Should February’s results point to another month of contraction, selling pressures for the Loonie could intensify once again.

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

No major news events.

What can we expect from Oil today?

Oil prices continued to face strong overhead pressures as the EIA oil inventories posted a larger-than-expected build of 3.6M barrels of crude while traders remained concerned about plans by OPEC+ to increase output in April. WTI oil dived over 4% at its lowest point before settling around $66.30 per barrel, declining 2.6% on Wednesday. This benchmark stabilized as Asian markets came online on Thursday and edged higher towards the $67 mark. However, any retracement to the upside is likely to be met with strong resistance for this commodity.

Next 24 Hours Bias

Strong Bearish

The post IC Markets Europe Fundamental Forecast | 6 March 2025 first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bullish 

Overall momentum of the chart: Bearish

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

Pivot: 103.98
Supporting reasons: Identified as a pullback support that aligns with the 100% Fibonacci projection, indicating a potential area where price could rebound

1st support: 102.32
Supporting reasons: Identified as a swing low support, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 105.65
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

EUR/USD:

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: 1.0836
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: 1.0684
Supporting reasons: Identified as a pullback support, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 1.1003
Supporting reasons: Identified as a pullback resistance that aligns with the 78.6% Fibonacci projection, indicating a potential level where price could face selling pressure.

EUR/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 160.05
Supporting reasons: Identified as a pullback support, indicating a potential area where price could rebound

1st support: 158.35
Supporting reasons: Identified as a pullback support, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 161.78
Supporting reasons: Identified as an overlap resistance that aligns close to the 78.6% Fibonacci retracement, indicating a potential level where price could face selling pressure.

EUR/GBP:

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: 0.8382
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: 0.8354
Supporting reasons: Identified as a pullback support that aligns with the 23.6% Fibonacci retracement, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 0.8420
Supporting reasons: Identified as an overlap resistance that aligns with the 78.6% Fibonacci extension, indicating a potential level that could cap further upward movement.

GBP/USD:

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: 1.2915
Supporting reasons: Identified as a pullback resistance that aligns with the 61.8% Fibonacci retracement and the 100% Fibonacci projection, indicating a potential area where selling pressure could emerge.

1st support: 1.2797
Supporting reasons: Identified as a pullback support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 1.3038
Supporting reasons: Identified as an overlap resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

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

Pivot: 190.06
Supporting reasons: Identified as a pullback support that aligns with the 50% Fibonacci retracement, indicating a potential area where price could rebound.

1st support: 188.45
Supporting reasons: Identified as a multi swing low support, indicating a potential level where price could stabilize before continuing higher.

1st resistance: 192.67
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: Bearish

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

Pivot: 0.8857
Supporting reasons: Identified as a swing low support, indicating a potential area where price could rebound.

1st support: 0.8835
Supporting reasons: Identified as a support that aligns with the 161.8% Fibonacci extension, indicating a potential level where price could face selling pressure.

1st resistance: 0.8953
Supporting reasons: Identified as a pullback resistance that aligns with the 50% Fibonacci retracement, 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 continuation toward the 1st resistance.

Pivot: 148.23
Supporting reasons: Identified as a swing low support, indicating a potential area where price could rebound.

1st support: 146.98
Supporting reasons: Identified as a swing low support, suggesting a potential area where price could stabilize before resuming its upward movement.

1st resistance: 151.25
Supporting reasons: Identified as an overlap resistance that aligns close to the 50% Fibonacci retracement, indicating a potential level where price could face selling pressure.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

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 an overlap resistance, indicating a potential area where selling pressures could intensify.

1st support: 1.4243
Supporting reasons: Identified as an overlap support that aligns close to a 78.6% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 1.4537
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.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price is falling towards the pivot and could 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.

1st support: 0.6246

Supporting reasons: Identified as an overlap support that aligns close to a 61.8% Fibonacci retracement, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6401
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 is falling towards the pivot and could potentially make a bullish bounce off this level to rise towards the 1st resistance.

Pivot: 0.5693

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 0.5665

Supporting reasons: Identified as a pullback support that aligns with a 50% Fibonacci retracement, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.5761

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

US30 (DJIA):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 42,602.40

Supporting reasons: Identified as a multi-swing-low support, indicating a potential area where buying interests could pick up to stage a minor rebound.

1st support: 41,674.92

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

1st resistance: 43,767.52

Supporting reasons: Identified as an overlap resistance that aligns close to a confluence of Fibonacci levels i.e. the 50% and 78.6% retracements, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bearish
Overall momentum of the chart: Neutral

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

Pivot: 23,230.00

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

1st support: 22,735.10

Supporting reasons: Identified as an overlap support that aligns close to a 50% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 23,582.97
Supporting reasons: Identified as a resistance level that aligns with a 127.2% 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: 5,919.99

Supporting reasons: Identified as a pullback resistance that aligns close to a confluence of Fibonacci levels i.e. the 50% and 78.6% retracements, 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: 5,768.10

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

1st resistance: 6,004.50

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

BTC/USD (Bitcoin):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

Price has made a bullish bounce off the pivot and could potentially rise towards the 1st resistance.

Pivot: 86,429.65

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 80,139.21
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 94,030.59
Supporting reasons: Identified as an overlap resistance that aligns close to a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 2,264.16

Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 2,000.46
Supporting reasons: Identified as a swing-low support that aligns close to a 127.2% Fibonacci extension, indicating a potential level where the price could stabilize once again.

1st resistance: 2,519.42
Supporting reasons: Identified as an overlap 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: 68.48

Supporting reasons: Identified as an overlap resistance that aligns close to a confluence of Fibonacci levels i.e. the 38.2% and 61.8% retracements, 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: 65.64
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 70.40
Supporting reasons: Identified as an overlap resistance that aligns close to a 61.8% 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: 2923.35
Supporting reasons: Identified as an overlap resistance that aligns close to the 78.6% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 2872.95
Supporting reasons: Identified as a pullback support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 2954.52
Supporting reasons: Identified as a multi swing high resistance, indicating a potential level where price could face selling pressure.

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The post Thursday 6th March 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 6 March 2025

What happened in the U.S. session?

The overnight U.S. macroeconomic data was mixed as the ADP report posted weak job gains while the Institute for Supply Management (ISM) showed services activity improving from January. Starting with the labour market, private businesses added just 77k workers to their payrolls in February. Not only did these figures print well below the forecast of 140k, but it also marked the smallest increase in seven months. “Policy uncertainty and a slowdown in consumer spending might have led to layoffs or a slowdown in hiring. Our data, combined with other recent indicators, suggests a hiring hesitancy among employers as they assess the economic climate ahead.“, remarked Nela Richardson, chief economist for the ADP. 

Meanwhile, services activity expanded for the eighth consecutive month as February’s PMI report pointed to faster growth, with key components such as business activity, new orders, employment and supplier deliveries all expanding for the third month in a row – occurring for the first time since May 2022. However, financial markets were overshadowed by the ongoing global trade war between the U.S. and its major trading partners. The dollar index (DXY) tumbled nearly 1.3% on Wednesday as it crashed under 105 and this index continued its downward slide on Thursday.

What does it mean for the Asia Session?

As Asian markets digest the latest macroeconomic data out of the U.S. and the ongoing tariff retaliation, the DXY looks set to break under the 104 mark as overhead pressures continue to intensify. Gold remained well bid as spot prices rose steadily towards $2,950/oz while oil prices moved in the opposite direction.

The Dollar Index (DXY)

Key news events today

Unemployment Claims (1:30 pm GMT)

Fed Governor Waller’s Speech (8:30 pm GMT)

What can we expect from DXY today?

Unemployment claims spiked last week as claims soared to 242k. Not only did the latest figures exceed market expectations of 221k, but they also registered the highest reading in over two months. Rising claims typically signal weakness for the U.S. labour market and it was evident in Wednesday’s soft DP employment report. Much later in the day, Federal Reserve Governor Christopher Waller will be speaking about the economic outlook at the Wall Street Journal CFO Network Summit in New York where audience questions are expected. His position as a Governor holds serious weight and his remarks could have a huge impact on financial markets in the latter part of the day.

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

Unemployment Claims (1:30 pm GMT)

Fed Governor Waller’s Speech (8:30 pm GMT)

What can we expect from Gold today?

Unemployment claims spiked last week as claims soared to 242k. Not only did the latest figures exceed market expectations of 221k, but they also registered the highest reading in over two months. Rising claims typically signal weakness for the U.S. labour market and it was evident in Wednesday’s soft DP employment report. Much later in the day, Federal Reserve Governor Christopher Waller will be speaking about the economic outlook at the Wall Street Journal CFO Network Summit in New York where audience questions are expected. His position as a Governor holds serious weight and his remarks could have a huge impact on financial markets in the latter part of the day.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

Following Wednesday’s strong rebound in economic activity in the final quarter of 2024, the Aussie saw strong gains. The Australian economy grew by 0.6% QoQ, exceeding the market consensus of 0.5%. It marked the 13th quarter of expansion and the fastest pace since Q4 2022, driven by a rebound in household spending, as expenditures on essentials like rent and healthcare continued to rise, and private investment. On the trade front, exports of goods and services both grew robustly. This currency pair rallied 1.4% on Wednesday and the upward momentum is likely to continue on Thursday.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 February, 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

Medium Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi soared almost 1.8% as it surged past 0.5700 on Wednesday, buoyed by intense selling in the greenback. This currency pair was rising strongly towards 0.5750 as Asian markets came online on Thursday.

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

Medium Bullish

The Japanese Yen (JPY)

Key news events today

No major news events.

What can we expect from JPY today?

Demand for the yen remained robust as markets accepted the reality of the Bank of Japan’s hawkish stance going into the central bank meeting on 19th March. The stronger yen drove USD/JPY to an overnight low of 148.38 and this currency pair is likely to face strong headwinds this week.

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 Bearish

The Euro (EUR)

Key news events today

ECB Interest Rate Decision (1:15 pm GMT)

ECB Press Conference (1:45 pm GMT)

What can we expect from EUR today?

After reducing their key interest rates by 25 basis points (bps) in January, the ECB is widely anticipated to make another 25-bps cut to mark the fifth consecutive meeting where rates were lowered – this would bring the main refinancing rate down to 2.65%. With economic activity in the Euro Area looking sluggish while the prospect of tariffs on EU exports to the U.S. grows stronger, the outlook for this region is bleak. ECB President Christine Lagarde commences her press conference half an hour after the release of the monetary statement and her remarks and replies to media questions will play a decisive role in the direction of the Euro.

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?

With inflationary pressures dissipating even further in February, demand for the franc could begin to wane. After hitting a low of 0.8857 on Wednesday, USD/CHF stabilised to rise higher following the release of Switzerland’s consumer inflation. This currency pair climbed above 0.8900 at the beginning of the Asia session and could continue to grind higher as the day progresses.

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

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Construction PMI (9:30 am GMT)

What can we expect from GBP today?

Construction activity in the U.K. fell sharply to 48.1 in January 2025 from 53.3 in December, missing market expectations of 53.4. The latest result signalled a contraction in overall industry output, ending a 10-month streak of sustained expansion, with firms citing the slowdown to delayed client decision-making on major projects and broader economic uncertainty. New business inflows – a sign of future demand –  dropped for the first time in 12 months in January, which is likely to result in a second successive month of contraction when February’s report drops during the European trading hours.

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

Ivey PMI (3:00 pm GMT)

What can we expect from CAD today?

The Ivey PMI had reported strong expansion from September through December 2024 but January’s report highlighted the first contraction in five months. This significant drop in output was attributed mainly to the ongoing trade tariffs between the U.S. and Canada, raising uncertainty and volatility for the Loonie. Should February’s results point to another month of contraction, selling pressures for the Loonie could intensify once again.

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

No major news events.

What can we expect from Oil today?

Oil prices continued to face strong overhead pressures as the EIA oil inventories posted a larger-than-expected build of 3.6M barrels of crude while traders remained concerned about plans by OPEC+ to increase output in April. WTI oil dived over 4% at its lowest point before settling around $66.30 per barrel, declining 2.6% on Wednesday. This benchmark stabilized as Asian markets came online on Thursday and edged higher towards the $67 mark. However, any retracement to the upside is likely to be met with strong resistance for this commodity.

Next 24 Hours Bias

Strong Bearish

The post IC Markets Asia Fundamental Forecast | 6 March 2025 first appeared on IC Markets | Official Blog.

The post Ex-Dividend 6/3/2025 first appeared on IC Markets | Official Blog.

Global Markets:

•  Asian Stock Markets : Nikkei up 0.28%, Shanghai Composite up 0.21%, Hang Seng up 1.96% ASX down 0.70%
• Commodities : Gold at $2922.35 (0.09%), Silver at $32.5 (0.58%), Brent Oil at $70.7 (-0.5%), WTI Oil at $67.68 (-0.8%)
• Rates : US 10-year yield at 4.240, UK 10-year yield at 4.5255, Germany 10-year yield at 2.4795

News & Data:

• (EUR) Unemployment Rate 6.2%  to 6.3% expected

Markets Update:

Asia-Pacific markets were mostly higher on Wednesday as investors analyzed China’s growth and inflation targets amid rising U.S. tariffs and global trade tensions. Australia’s S&P/ASX 200 dropped 0.77%, even as the country’s economy expanded 1.3% year over year in the fourth quarter, surpassing economists’ expectations of 1.2%. Japan’s Nikkei 225 gained 0.37%, while the Topix climbed 0.38%. South Korea’s Kospi rose 1.11%, with the small-cap Kosdaq advancing 0.91%. In China, Hong Kong’s Hang Seng Index jumped 1.65%, and the mainland’s CSI 300 edged up 0.32%.

Investors are closely monitoring China’s annual “Two Sessions” parliamentary gathering, which began Wednesday. During the event, China set its 2025 GDP growth target at approximately 5% and lowered inflation expectations to around 2%. These announcements come as the country aims to balance economic expansion with stability, amid concerns over slowing global demand and domestic economic challenges. The market’s response to these projections will be crucial in determining investor sentiment in the region.

Meanwhile, the U.S. imposed new tariffs on Mexico, Canada, and China. A 25% duty on Mexican and Canadian goods took effect Tuesday, while an additional 10% tariff on Chinese imports raised total new duties on China to 20%. The escalating trade tensions have raised concerns about supply chain disruptions and inflationary pressures, contributing to uncertainty in global financial markets.

Overnight, U.S. markets closed lower. The Dow Jones Industrial Average fell for a second consecutive session, plunging 670.25 points (1.55%) to 42,520.99. The S&P 500 dropped 1.22% to 5,778.15 after recording its worst session of the year earlier. The Nasdaq Composite declined 0.35% to close at 18,285.16. With global markets reacting to trade policies and economic updates, investors remain cautious about potential market volatility in the coming sessions.

Upcoming Events: 

• 01:15 PM GMT – USD ADP Non-Farm Employment Change
• 01:30 PM GMT – CAD Labor Productivity
• 02:45 PM GMT – USD Final Services PMI
• 03:00 PM GMT – USD ISM Services PMI

The post Wednesday 5th March 2025: Asia-Pacific Markets Rise Amid China’s Growth Targets and U.S. Tariffs first appeared on IC Markets | Official Blog.

IC Markets Europe Fundamental Forecast | 5 March 2025

What happened in the Asia session?

U.S. President Donald delivered his address to a joint session of Congress at the Capitol Building in Washington DC on Tuesday evening Eastern Time where he spoke on key themes such as Reversing Biden-Era Policies and Economic Renewal; Budget Balancing and Fiscal Policy; Support for Cryptocurrency Initiatives; Trade and Tariffs; and Defense of Allies and Administration Figures. President Trump’s first major address reiterated hot topics that were part of his election campaign and how they would be executed to the benefit of the American people. The dollar index (DXY) continued to face intense overhead pressures as it crashed under 106 on Tuesday and looks to extend the slide towards the 105 level as European markets come online. Meanwhile, gold resumes its upward trajectory with spot prices rising towards $2,950/oz.

What does it mean for the Europe & US sessions?

Consumer inflation in Switzerland fell to 0.4% MoM in January, in line with market expectations and down from 0.6% in December. This marked the lowest level since April 2021, driven by ongoing deflation in food and non-alcoholic beverages; clothing and footwear; household goods and services; healthcare; and transport. Should inflationary pressures continue to dissipate even further, the franc could face strong headwinds before the start of the European trading hours.

Based on preliminary results, the Eurozone’s Composite PMI came in at 50.2 in February of 2025, remaining unchanged from the previous month for a second consecutive period of muted growth in the Eurozone’s private sector activity, although slightly missing market expectations of 50.5. Growth was carried by the services sector, despite its slowdown, while manufacturing activity contracted at the slowest pace in nine months. New orders – a sign of future growth – at the aggregate level contracted for the ninth month in a month, underscoring the weak demand levels in the bloc. Should the final result disappoint market expectations, it could dampen the recent rise in the Euro.

Moving over to the U.K., the flash Composite PMI reading came in at 50.5 in February, inching lower from 50.6 in the previous month but in line with the market consensus. Economic growth was solely driven by the services sector, which offset a sharper decline in manufacturing, matching a similar trend in other major European economies. The latest survey indicated the sharpest contraction in new business received by firms in one-and-a-half years, with firms citing cuts to clients’ budgets and muted business investment spending. The lower demand for capacity drove companies to shed jobs at the sharpest pace since the global financial crisis when excluding the pandemic shock. Should the final report unexpectedly print lower than the preliminary estimates, selling pressures for the pound could intensify during the European trading hours.

The Dollar Index (DXY)

Key news events today

President Trump’s Speech (2:00 am GMT)

ADP Employment Report (1:15 pm GMT)

ISM Services PMI (3:00 pm GMT)

What can we expect from DXY today?

The first glimpse into the state of the labour market will be revealed in the ADP employment report, where 141k jobs are expected to be created in February. Private businesses added 183k workers to their payrolls in January 2025, above forecasts of 150K, while December’s figures saw an upward revision to 176k in December 2024. Hiring momentum in the fourth quarter carried into January with some exceptions, including manufacturing.

After which, the Institute for Supply Management (ISM) will release its Services PMI report for February where the latest reading is expected to remain steady at 52.5, marking the seventh consecutive month of expansion. Looking at past reports, January’s reading declined to 52.8, well below forecasts of 54.3, while December saw a downward revision to 54. January’s report pointed to a slower expansion in the services sector, due to smaller increases in business activity and new orders. The latter – which is a sign of future demand – corroborates February’s forecast of 52.5, highlighting a continued slowdown in activity levels for this sector. Financial markets are likely to remain on red alert on Wednesday.

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

Strong Bearish

Gold (XAU)

Key news events today

President Trump’s Speech (2:00 am GMT)

ADP Employment Report (1:15 pm GMT)

ISM Services PMI (3:00 pm GMT)

What can we expect from Gold today?

The first glimpse into the state of the labour market will be revealed in the ADP employment report, where 141k jobs are expected to be created in February. Private businesses added 183k workers to their payrolls in January 2025, above forecasts of 150K, while December’s figures saw an upward revision to 176k in December 2024. Hiring momentum in the fourth quarter carried into January with some exceptions, including manufacturing.

After which, the Institute for Supply Management (ISM) will release its Services PMI report for February where the latest reading is expected to remain steady at 52.5, marking the seventh consecutive month of expansion. Looking at past reports, January’s reading declined to 52.8, well below forecasts of 54.3, while December saw a downward revision to 54. January’s report pointed to a slower expansion in the services sector, due to smaller increases in business activity and new orders. The latter – which is a sign of future demand – corroborates February’s forecast of 52.5, highlighting a continued slowdown in activity levels for this sector. Gold prices are likely to edge higher as the day progresses.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

GDP (12:30 am GMT)

What can we expect from AUD today?

The Australian economy grew by 0.3% QoQ in the third quarter of 2024, following a 0.2% increase in the prior three quarters. This marked the 12th straight period of quarterly growth but fell short of market expectations of 0.4%. Fixed investment picked up strongly, marking the strongest growth in five quarters. Market estimates of 0.6% point to a strong rebound in the final quarter of last year, a result that could lift the Aussie even higher – this currency pair was racing towards 0.6300 at the beginning of this session.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 February, 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

Strong Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi will likely take its cue from its Pacific neighbour and rise strongly should the Australian economy mark a strong expansion in the final quarter of 2024 – this currency pair surged past 0.5650 overnight.

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

Strong Bullish

The Japanese Yen (JPY)

Key news events today

S&P Global Composite PMI (12:30 am GMT)

What can we expect from JPY today?

Japan’s Composite PMI rose to 51.6 in January, up from 51.1 the previous month, based on preliminary results. This was the fourth consecutive month of growth in private sector activity and the strongest pace since last September, significantly surpassing the long-run trend level of 49.3. The service sector grew at the strongest pace in five months; while factory activity shrank at a milder rate. Total new orders expanded for the seventh time in eight months despite the pace of growth the least since last November. The final reading is expected to point to an unchanged figure and another month of robust growth would reinforce the Bank of Japan’s hawkish stance going into the central bank meeting on 19th March.

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

Medium Bearish

The Euro (EUR)

Key news events today

S&P Global Composite PMI (9:00 am GMT)

What can we expect from EUR today?

Based on preliminary results, the Eurozone’s Composite PMI came in at 50.2 in February of 2025, remaining unchanged from the previous month for a second consecutive period of muted growth in the Eurozone’s private sector activity, although slightly missing market expectations of 50.5. Growth was carried by the services sector, despite its slowdown, while manufacturing activity contracted at the slowest pace in nine months. New orders – a sign of future growth – at the aggregate level contracted for the ninth month in a month, underscoring the weak demand levels in the bloc. Should the final result disappoint market expectations, it could dampen the recent rise in the Euro.

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

Strong Bullish

The Swiss Franc (CHF)

Key news events today

CPI (7:30 am GMT)

What can we expect from CHF today?

Consumer inflation in Switzerland fell to 0.4% MoM in January, in line with market expectations and down from 0.6% in December. This marked the lowest level since April 2021, driven by ongoing deflation in food and non-alcoholic beverages; clothing and footwear; household goods and services; healthcare; and transport. Should inflationary pressures continue to dissipate even further, the franc could face strong headwinds before the start of the European trading hours.

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

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Composite PMI (9:30 am GMT)

What can we expect from GBP today?

The flash Composite PMI reading came in at 50.5 in February, inching lower from 50.6 in the previous month but in line with the market consensus. Economic growth was solely driven by the services sector, which offset a sharper decline in manufacturing, matching a similar trend in other major European economies. The latest survey indicated the sharpest contraction in new business received by firms in one-and-a-half years, with firms citing cuts to clients’ budgets and muted business investment spending. The lower demand for capacity drove companies to shed jobs at the sharpest pace since the global financial crisis when excluding the pandemic shock. Should the final report unexpectedly print lower than the preliminary estimates, selling pressures for the pound could intensify during the European trading hours.

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

Strong Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Ongoing trade tariffs between Canada and the U.S. have raised uncertainty and volatility for the Loonie as USD/CAD hit an overnight high of 1.4542 before reversing sharply to dive under 1.4400 and drop as low as 1.4370. This currency pair was floating around 1.4400 at the beginning of the Asia session and will likely continue to experience wild swings.

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?

For the second week in a row, the API registered a larger-than-expected drawdown with nearly 1.5M barrels of crude removed from storage. Despite this drawdown which typically signals higher demand from the U.S., oil prices slid lower as WTI oil shed more than 2.5% at its lowest point. This benchmark was hovering around $67.90 per barrel as Asian markets came online but intense overhead pressures remain. Even if the EIA were to report a strong draw later today, falling inventory levels would be insufficient to support oil prices.

Next 24 Hours Bias

Strong Bearish

The post IC Markets Europe Fundamental Forecast | 5 March 2025 first appeared on IC Markets | Official Blog.

It has already been a volatile week for currencies, and traders expect the lively market conditions to persist through the New York close on Friday. Geopolitical factors have played a major role in market movements this week, but traders anticipate a shift in focus toward macroeconomic fundamentals, with a series of key data releases scheduled for the remainder of the week, culminating in the U.S. employment data early in the New York session on Friday.

There has been significant volatility across major currency pairs this week, but as usual, the standout has been USD/JPY, and this trend is expected to continue in Friday’s trading sessions. USD/JPY has dropped nearly 7% since its high in early January, and despite a rally off last night’s lows, it remains vulnerable to further downside movement. Interest rate differentials have played a significant role since the start of the year, as the Bank of Japan remains hawkish while expectations for a Federal Reserve rate cut have shifted forward from September to June—or even May. If the jobs data also indicate a slowing U.S. economy, expectations could move even closer, further widening the interest rate differential and pushing USD/JPY lower.

The consensus forecast for the headline NFP figure is for 160,000 jobs to have been added in the past month, with average hourly earnings increasing by 0.3% and the unemployment rate dipping to 4.0%. A significantly weaker-than-expected report could see the recent low just above 148.00 tested, while a stronger result would likely push the pair higher, with initial resistance around 152.30—where both the daily resistance trendline and the 200-day moving average currently align.

Key Levels to Watch

Resistance 2: 158.03 – Long-Term Trendline Resistance

Resistance 1: 152.30 – Trendline Resistance and 200 Day Moving Average

Support 1: 148.07 – Trendline Support and 2025 Low

Support 2: 144.40 – Long-Term Trendline Support

The post Trade USDJPY on the Non-Farm Payrolls first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bearish

Overall momentum of the chart: Bearish

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

Pivot: 106.18
Supporting reasons: Identified as a pullback resistance, indicating a potential area where selling pressure could emerge.

1st support: 105.27
Supporting reasons: Identified as a swing low support that aligns close to the 161.8% Fibonacci extension, indicating as a potential area where price could stabilize before continuing higher.

1st resistance: 106.86
Supporting reasons: Identified as a pullback resistance, indicating a potential level that could cap further upward movement.

EUR/USD:

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: 1.0627
Supporting reasons: Identified as a swing high resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area where selling pressure could emerge.

1st support: 1.0518
Supporting reasons: Identified as a pullback support that aligns with the 38.2% Fibonacci retracement, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 1.0710
Supporting reasons: Identified as a multi swing high resistance, indicating a potential level where price could face selling pressure.

EUR/JPY:

Potential Direction: Bearish
Overall momentum of the chart: Bearish

Price could potentially make a bearish reversal off the pivot and fall toward the 1st support.

Pivot: 160.23
Supporting reasons: Identified as an overlap resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area where selling pressure could emerge.

1st support: 158.19
Supporting reasons: Identified as a pullback support, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 161.78
Supporting reasons: Identified as an overlap resistance that aligns close to the 78.6% 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 and falling toward the 1st support.

Pivot: 0.8319
Supporting reasons: Identified as a pullback resistance that aligns with the 127.2% Fibonacci extension, indicating a potential area where selling pressure could emerge.

1st support: 0.8273
Supporting reasons: Identified as a pullback support, indicating a potential area where price could stabilize before continuing higher.

1st resistance: 0.8355
Supporting reasons: Identified as an overlap resistance that aligns with the 50% Fibonacci extension, indicating a potential level that could cap further upward movement.

GBP/USD:

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: 1.2797
Supporting reasons: Identified as a multi swing high resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area where selling pressure could emerge.

1st support: 1.2719
Supporting reasons: Identified as a pullback support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 1.2863
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

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

Pivot: 190.06
Supporting reasons: Identified as a pullback support, indicating a potential area where price could rebound.

1st support: 188.43
Supporting reasons: Identified as a multi swing low support, indicating a potential level where price could stabilize before continuing higher.

1st resistance: 192.67
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: Bearish

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

Pivot: 0.88.79
Supporting reasons: Identified as a support that aligns close to the 127.2% Fibonacci extension, indicating a potential area where price could rebound.

1st support: 0.8835
Supporting reasons: Identified as a support that aligns with the 161.8% Fibonacci extension, indicating a potential level where price could face selling pressure.

1st resistance: 0.8994
Supporting reasons: Identified as a pullback 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 continuation toward the 1st resistance.

Pivot: 149.26
Supporting reasons: Identified as a pullback support, indicating a potential area where price could rebound.

1st support: 148.10
Supporting reasons: Identified as a swing low support, suggesting a potential area where price could stabilize before resuming its upward movement.

1st resistance: 151.25
Supporting reasons: Identified as an overlap resistance that aligns close to the 50% Fibonacci retracement, indicating a potential level where price could face selling pressure.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bullish

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

Pivot: 1.4537

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

1st support: 1.4359
Supporting reasons: Identified as a pullback support that aligns close to a 50% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 1.4749
Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 0.6200

Supporting reasons: Identified as a multi-swing-low support, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 0.6151

Supporting reasons: Identified as a pullback support that aligns close to a 78.6% Fibonacci retracement, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6270
Supporting reasons: Identified as a swing-high resistance that aligns close to a 38.2% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 0.5633

Supporting reasons: Identified as a pullback support that aligns close to a 38.2% Fibonacci retracement, indicating a potential area where buying interests could pick up stage a minor rebound.

1st support: 0.5590

Supporting reasons: Identified as a multi-swing-low support, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.5692

Supporting reasons: Identified as an overlap resistance that aligns close to 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: 42,879.91

Supporting reasons: Identified as a pullback resistance that aligns close to a confluence of Fibonacci levels i.e. the 23.6% and 38.2% retracements, 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: 41,674.92

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

1st resistance: 43,767.52

Supporting reasons: Identified as an overlap resistance that aligns close to a confluence of Fibonacci levels i.e. the 50% and 78.6% retracements, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bullish
Overall momentum of the chart: Neutral

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

Pivot: 22,163.30

Supporting reasons: Identified as a multi-swing-low support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 21,927.70

Supporting reasons: Identified as a pullback support that aligns with a 38.2% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 23,133.40
Supporting reasons: Identified as a swing-high resistance that aligns close to the all-time high, 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: 5,844.90

Supporting reasons: Identified as a pullback resistance that aligns close to a 50% 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: 5,700.70

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

1st resistance: 5,923.40

Supporting reasons: Identified as a pullback resistance that aligns close to a confluence of Fibonacci levels i.e. the 50% and 78.6% retracements, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bullish
Overall momentum of the chart: Bearish

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

Pivot: 86,429.65

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 80,139.21
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once more.

1st resistance: 94,030.59
Supporting reasons: Identified as an overlap resistance that aligns close to a 78.6% 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: 2,264.16

Supporting reasons: Identified as a pullback resistance that aligns close to a 50% 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: 2,000.46
Supporting reasons: Identified as a swing-low support that aligns close to a 127.2% Fibonacci extension, indicating a potential level where the price could stabilize once again.

1st resistance: 2,519.42
Supporting reasons: Identified as an overlap 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 has made a bearish reversal off the pivot and could potentially fall towards the 1st support.

Pivot: 68.48

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: 65.64
Supporting reasons: Identified as a swing-low support that aligns close to a 100% Fibonacci projection, indicating a key level where the price could stabilize once more.

1st resistance: 70.40
Supporting reasons: Identified as an overlap resistance that aligns close to a 61.8% 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: 2923.35
Supporting reasons: Identified as an overlap resistance that aligns close to the 78.6% Fibonacci retracement, indicating a potential area where selling pressure could emerge.

1st support: 2872.95
Supporting reasons: Identified as a pullback support, acting as a potential level where price could stabilize before continuing higher.

1st resistance: 2954.52
Supporting reasons: Identified as a multi swing high resistance, indicating a potential level where price could face selling pressure.

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The post Wednesday 5th March 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

IC Markets Asia Fundamental Forecast | 5 March 2025

What happened in the U.S. session?

The implementation of trade tariffs on Canada and Mexico continue to dominate financial markets, escalating uncertainties and intensifying volatility across all asset classes. The dollar index (DXY) dived sharply this week, tumbling nearly 2% over the last couple of days while spot prices for gold climbed above $2,900/oz overnight. With U.S. President Donald Trump delivering his address to a joint session of Congress at the Capitol Building in Washington DC on Tuesday evening eastern time (2:00 am GMT), markets remain on red alert.

What does it mean for the Asia Session?

The Australian economy grew by 0.3% QoQ in the third quarter of 2024, following a 0.2% increase in the prior three quarters. This marked the 12th straight period of quarterly growth but fell short of market expectations of 0.4%. Fixed investment picked up strongly, marking the strongest growth in five quarters. Market estimates of 0.6% point to a strong rebound in the final quarter of last year, a result that could lift the Aussie even higher – this currency pair was racing towards 0.6300 at the beginning of this session.

Japan’s Composite PMI rose to 51.6 in January, up from 51.1 the previous month, based on preliminary results. This was the fourth consecutive month of growth in private sector activity and the strongest pace since last September, significantly surpassing the long-run trend level of 49.3. The service sector grew at the strongest pace in five months; while factory activity shrank at a milder rate. Total new orders expanded for the seventh time in eight months despite the pace of growth the least since last November. The final reading is expected to point to an unchanged figure and another month of robust growth would reinforce the Bank of Japan’s hawkish stance going into the central bank meeting on 19th March.

U.S. President Donald will deliver his address to a joint session of Congress at the Capitol Building in Washington DC on Tuesday evening eastern time (2:00 am GMT).  It will be President Trump’s first major speech since returning to the White House in January, providing a platform for him to lay out his agenda and talk about key policy objectives.

The Dollar Index (DXY)

Key news events today

President Trump’s Speech (2:00 am GMT)

ADP Employment Report (1:15 pm GMT)

ISM Services PMI (3:00 pm GMT)

What can we expect from DXY today?

U.S. President Donald will deliver his address to a joint session of Congress at the Capitol Building in Washington DC on Tuesday evening eastern time (2:00 am GMT). It will be President Trump’s first major speech since returning to the White House in January, providing a platform for him to lay out his agenda and talk about key policy objectives. Later on, the first glimpse into the state of the labour market will be revealed in the ADP employment report, where 141k jobs are expected to be created in February. Private businesses added 183k workers to their payrolls in January 2025, above forecasts of 150K, while December’s figures saw an upward revision to 176k in December 2024. Hiring momentum in the fourth quarter carried into January with some exceptions, including manufacturing.

After which, the Institute for Supply Management (ISM) will release its Services PMI report for February where the latest reading is expected to remain steady at 52.5, marking the seventh consecutive month of expansion. Looking at past reports, January’s reading declined to 52.8, well below forecasts of 54.3, while December saw a downward revision to 54. January’s report pointed to a slower expansion in the services sector, due to smaller increases in business activity and new orders. The latter – which is a sign of future demand – corroborates February’s forecast of 52.5, highlighting a continued slowdown in activity levels for this sector. Financial markets are likely to see higher volatility today, especially during President Trump’s speech.

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

Strong Bearish

Gold (XAU)

Key news events today

President Trump’s Speech (2:00 am GMT)

ADP Employment Report (1:15 pm GMT)

ISM Services PMI (3:00 pm GMT)

What can we expect from Gold today?

U.S. President Donald will deliver his address to a joint session of Congress at the Capitol Building in Washington DC on Tuesday evening eastern time (2:00 am GMT). It will be President Trump’s first major speech since returning to the White House in January, providing a platform for him to lay out his agenda and talk about key policy objectives. Later on, the first glimpse into the state of the labour market will be revealed in the ADP employment report, where 141k jobs are expected to be created in February. Private businesses added 183k workers to their payrolls in January 2025, above forecasts of 150K, while December’s figures saw an upward revision to 176k in December 2024. Hiring momentum in the fourth quarter carried into January with some exceptions, including manufacturing.

After which, the Institute for Supply Management (ISM) will release its Services PMI report for February where the latest reading is expected to remain steady at 52.5, marking the seventh consecutive month of expansion. Looking at past reports, January’s reading declined to 52.8, well below forecasts of 54.3, while December saw a downward revision to 54. January’s report pointed to a slower expansion in the services sector, due to smaller increases in business activity and new orders. The latter – which is a sign of future demand – corroborates February’s forecast of 52.5, highlighting a continued slowdown in activity levels for this sector. Gold prices are likely to see higher volatility today, especially during President Trump’s speech.

Next 24 Hours Bias

Medium Bullish

The Australian Dollar (AUD)

Key news events today

GDP (12:30 am GMT)

What can we expect from AUD today?

The Australian economy grew by 0.3% QoQ in the third quarter of 2024, following a 0.2% increase in the prior three quarters. This marked the 12th straight period of quarterly growth but fell short of market expectations of 0.4%. Fixed investment picked up strongly, marking the strongest growth in five quarters. Market estimates of 0.6% point to a strong rebound in the final quarter of last year, a result that could lift the Aussie even higher – this currency pair was racing towards 0.6300 at the beginning of this session.

Central Bank Notes:

• The RBA reduced the cash rate by 25 basis points to bring it down to 4.10% on 18 February, 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

Strong Bullish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

The Kiwi will likely take its cue from its Pacific neighbour and rise strongly should the Australian economy mark a strong expansion in the final quarter of 2024 – this currency pair surged past 0.5650 overnight.

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

Strong Bullish

The Japanese Yen (JPY)

Key news events today

S&P Global Composite PMI (12:30 am GMT)

What can we expect from JPY today?

Japan’s Composite PMI rose to 51.6 in January, up from 51.1 the previous month, based on preliminary results. This was the fourth consecutive month of growth in private sector activity and the strongest pace since last September, significantly surpassing the long-run trend level of 49.3. The service sector grew at the strongest pace in five months; while factory activity shrank at a milder rate. Total new orders expanded for the seventh time in eight months despite the pace of growth the least since last November. The final reading is expected to point to an unchanged figure and another month of robust growth would reinforce the Bank of Japan’s hawkish stance going into the central bank meeting on 19th March.

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

Medium Bearish

The Euro (EUR)

Key news events today

S&P Global Composite PMI (9:00 am GMT)

What can we expect from EUR today?

Based on preliminary results, the Eurozone’s Composite PMI came in at 50.2 in February of 2025, remaining unchanged from the previous month for a second consecutive period of muted growth in the Eurozone’s private sector activity, although slightly missing market expectations of 50.5. Growth was carried by the services sector, despite its slowdown, while manufacturing activity contracted at the slowest pace in nine months. New orders – a sign of future growth – at the aggregate level contracted for the ninth month in a month, underscoring the weak demand levels in the bloc. Should the final result disappoint market expectations, it could dampen the recent rise in the Euro.

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

Strong Bullish

The Swiss Franc (CHF)

Key news events today

CPI (7:30 am GMT)

What can we expect from CHF today?

Consumer inflation in Switzerland fell to 0.4% MoM in January, in line with market expectations and down from 0.6% in December. This marked the lowest level since April 2021, driven by ongoing deflation in food and non-alcoholic beverages; clothing and footwear; household goods and services; healthcare; and transport. Should inflationary pressures continue to dissipate even further, the franc could face strong headwinds before the start of the European trading hours.

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

Weak Bearish

The Pound (GBP)

Key news events today

S&P Global Composite PMI (9:30 am GMT)

What can we expect from GBP today?

The flash Composite PMI reading came in at 50.5 in February, inching lower from 50.6 in the previous month but in line with the market consensus. Economic growth was solely driven by the services sector, which offset a sharper decline in manufacturing, matching a similar trend in other major European economies. The latest survey indicated the sharpest contraction in new business received by firms in one-and-a-half years, with firms citing cuts to clients’ budgets and muted business investment spending. The lower demand for capacity drove companies to shed jobs at the sharpest pace since the global financial crisis when excluding the pandemic shock. Should the final report unexpectedly print lower than the preliminary estimates, selling pressures for the pound could intensify during the European trading hours.

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

Strong Bullish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

Ongoing trade tariffs between Canada and the U.S. have raised uncertainty and volatility for the Loonie as USD/CAD hit an overnight high of 1.4542 before reversing sharply to dive under 1.4400 and drop as low as 1.4370. This currency pair was floating around 1.4400 at the beginning of the Asia session and will likely continue to experience wild swings.

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?

For the second week in a row, the API registered a larger-than-expected drawdown with nearly 1.5M barrels of crude removed from storage. Despite this drawdown which typically signals higher demand from the U.S., oil prices slid lower as WTI oil shed more than 2.5% at its lowest point. This benchmark was hovering around $67.90 per barrel as Asian markets came online but intense overhead pressures remain. Even if the EIA were to report a strong draw later today, falling inventory levels will be insufficient to support oil prices.

Next 24 Hours Bias

Strong Bearish

The post IC Markets Asia Fundamental Forecast | 5 March 2025 first appeared on IC Markets | Official Blog.