BNY’s Head of Markets Macro Strategy Bob Savage reports that the Euro faces conflicting forces as ECB President Christine Lagarde warns of potential forceful tightening if energy-driven inflation persists, while growth risks rise.
GBP/JPY trades within a tight range on Wednesday, with choppy price action as ongoing developments in the US-Israel war with Iran continue to drive volatility across the FX space, while traders show limited reaction to recent economic data.
USD/JPY trades around 159.00 on Wednesday at the time of writing, up 0.18% on the day. The pair continues to draw support from sustained demand for the US Dollar (USD) in an environment marked by persistent geopolitical uncertainty.
TD Securities expects Norges Bank to keep its policy rate unchanged at 4.00%, noting stubbornly sticky inflation and risks of re-acceleration after the Middle East crisis and energy price shock.
Brown Brothers Harriman’s (BBH) Elias Haddad highlights that AUD/USD is trading near the lower end of its recent 0.6900–0.7200 range. February inflation was slightly softer than expected, but Haddad expects Australian price pressures to accelerate as higher energy costs feed through.
ABN AMRO economists revise their Eurozone outlook after the Iran-related energy shock, expecting weaker growth but notably higher inflation. They now see the European Central Bank (ECB) hiking twice in Q2, front‑loading tightening to prevent second‑round effects.
ING’s James Smith outlines scenarios for UK inflation, with current energy prices implying a brief 4% peak in autumn and ING’s base case of easing disruption pointing to a 3.5% peak in September.
Commerzbank’s Chief Economist Dr. Jörg Krämer warns that the sharp March drop in the German Ifo Business Climate Index reflects rising war-related risks rather than current damage.
Bank of England Monetary Policy Committee member Megan Greene said on Wednesday that if their inflation forecasts are right, there is a risk inflation expectations will rise, per Reuters.
Citing informed sources on the matter, Iran's Fars news agency reported on Wednesday that Tehran doesn't see truce and talks as viable in current conditions, despite the United States' increased efforts to establish a ceasefire and begin direct negotiations.
Brown Brothers Harriman’s (BBH) Elias Haddad notes GBP/USD is challenging resistance at its 200-day moving average near 1.3434 as UK inflation remains well above the Bank of England's (BoE) 2% target.
Canada Employment Insurance Beneficiaries Change (MoM) declined to -1.9% in January from previous 0.4%
