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FOREX: Greenback Loses Ground, USDCHF Extends Intra-Day Decline to 1%

FOREX
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  • The USD index has weakened around 0.5% on Thursday, as a multitude of factors produced further questions over the greenback’s dominant uptrend in the aftermath of the US election. The market analysed some notably soft details within the PPI data report, translating that into a more negative read for the Fed’s preferred measure of inflation (PCE).
  • With this dynamic weighing on US treasury yields, the USD remained marginally on the back foot. Dollar weakness then picked up momentum as headlines crossed from CNBC suggesting that new reciprocal tariffs to be announced by President Trump would not go into effect today. With a possible start date of April 1 being proposed, risk sentiment was boosted as equity indices extended higher which in turn weighed broadly on the dollar.
  • EURUSD has made a bullish development today by breaching the 50-day EMA, rising to a high of 1.0445. A clear breach of the average would strengthen a bullish condition and signal scope for stronger recovery and open 1.0533, the Jan 27 high.
  • USDJPY is down 0.80% on the session, and although this is a sizeable daily adjustment, the pair has only pulled back to around mid-range for the week following the significant recovery seen on Wednesday.
  • Lower core yields, a softer greenback and the hotter-than-expected core CPI print in Switzerland are all contributing to the ongoing weakness for USDCHF on Thursday. The pair has traded as low as 0.9036, extending session losses to ~1% and narrowing the gap to an area of key support. USDCHF has continually failed to close below the 50-day EMA, which currently intersects at 0.9024. Below here, the January low resides at 0.8965.
  • China loans data and the second estimate of Eurozone GDP will be released on Friday, before the focus turns to the January US retail sales report.
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  • The USD index has weakened around 0.5% on Thursday, as a multitude of factors produced further questions over the greenback’s dominant uptrend in the aftermath of the US election. The market analysed some notably soft details within the PPI data report, translating that into a more negative read for the Fed’s preferred measure of inflation (PCE).
  • With this dynamic weighing on US treasury yields, the USD remained marginally on the back foot. Dollar weakness then picked up momentum as headlines crossed from CNBC suggesting that new reciprocal tariffs to be announced by President Trump would not go into effect today. With a possible start date of April 1 being proposed, risk sentiment was boosted as equity indices extended higher which in turn weighed broadly on the dollar.
  • EURUSD has made a bullish development today by breaching the 50-day EMA, rising to a high of 1.0445. A clear breach of the average would strengthen a bullish condition and signal scope for stronger recovery and open 1.0533, the Jan 27 high.
  • USDJPY is down 0.80% on the session, and although this is a sizeable daily adjustment, the pair has only pulled back to around mid-range for the week following the significant recovery seen on Wednesday.
  • Lower core yields, a softer greenback and the hotter-than-expected core CPI print in Switzerland are all contributing to the ongoing weakness for USDCHF on Thursday. The pair has traded as low as 0.9036, extending session losses to ~1% and narrowing the gap to an area of key support. USDCHF has continually failed to close below the 50-day EMA, which currently intersects at 0.9024. Below here, the January low resides at 0.8965.
  • China loans data and the second estimate of Eurozone GDP will be released on Friday, before the focus turns to the January US retail sales report.