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Geopolitics and inflation remain top of mind
In the coming week, Fed policy and geopolitics will continue to remain in the spotlight for traders and keep volatility higher in financial markets. Read more
Brief spike in oil and teetering Treasuries keeps the dollar firm
Given the risk and intensification of geopolitical risk recently, traders are trimming risk piling into defensive assets like gold, oil, and the dollar. Read more
Asian policymakers sound hawkish alarm
Assisting the slight retracement in the dollar’s rally was a trilateral statement from the Finance Ministers of Japan, Republic of Korea, and the US. Read more
The yuan’s fortunes look less constructive
With the US and Chinese economic prospects starting to diverge, we now think USDCNY will struggle to durably break below 7.00 over the coming years. Read more
Powell’s pause spurs the dollar higher
Powell’s tone shifted notably hawkish yesterday, leading two-year yields to test 5% and the dollar DXY to extend its gains north of the 106 handle. Read more
Sticky inflation to keep rates unchanged in June
While headline inflation continued its downward trend in March, a smaller than expected fall reconfirms the message from yesterday’s pay data. Read more
BoC on track to cut in June and quickly thereafter
The Bank of Canada remains on track to cut rates in June despite the latest data showing inflation ticked up from 2.8% in February to 2.9% YoY in March. Read more
PBoC’s tolerance changes, spurring more dollar strength
The direction of travel for US rates and the dollar remains higher over a tactical horizon, especially after the PBoC set the USDCNY fixing above 7.10. Read more
February wage growth should sound a note of caution for the BoE
This morning’s UK labour market data is unlikely to help give the Bank of England sufficient confidence to cut rates in June. Read more
Dollar bulls remain in the driving seat
Given the increased level of geopolitical risk and the direction of travel in monetary policy, Monex analysts' bias remains bullish USD this week. Read more
A break in the ranges
With a swathe of central bank speakers on the roster for in the coming week, conditions should remain volatile for financial markets. Read more
MAS unchanged stance to put a ceiling on USDSGD
The Monetary Authority of Singapore decided to keep the slope of the S$NEER policy band unchanged. Read more
The dollar holds on to post CPI gains
The DXY index stabilised in a new, higher, post CPI range, with yesterday’s PPI figures doing little to disrupt this dynamic. Read more
The ECB not recommitting, but sets up a cut in June
The ECB has kept rates unchanged once again, maintaining the deposit rate at 4.00% in line with widespread consensus and our own pre-announcement call. Read more
US CPI puts a rocket under the dollar
US inflation wreaked havoc in markets yesterday, as headline and core inflation landed 0.1pp above expectations at 0.4% MoM respectively. Read more
Bank of Canada on track for June cut
The Bank of Canada left its policy rate unchanged at 5% today, which came as no surprise to markets. Read more
Bump in US disinflation path looks more like a mountain than a molehill
Both headline and core measures of US CPI landed 0.1pp above expectations on a monthly basis in March, printing at 0.4% MoM respectively on a rounded basis. Read more
US CPI holds asymmetric risks for markets
If expectations are met in today's US CPI data release, concern in markets that the Fed’s expected easing cycle is at risk of delay will be confirmed. Read more
Banxico to remain cautious even as inflation misses expectations
Headline and core inflation in Mexico came in slightly below consensus expectations for a notable pick-up in inflation in March. Read more
Not yet convinced the dollar has peaked
We think the dollar has further room to climb higher and look towards tomorrow’s inflation report as a catalyst for the greenback’s next leg higher. Read more
Don’t be fooled, the dollar will break higher
Some of the key restrictions to the dollar’s climb higher could easily be broken this week from data released in Wednesday’s inflation report. Read more
Moving in opposite directions
Next week, we will get to see if the BoC’s Governing Council now agrees with our view, tilting dovish and steer towards commencing rate cuts in June. Read more
Strong payrolls print, but June still the base case
The March US nonfarm payrolls print beat all expectations, showing the economy added 303k jobs. Read more
Canada’s labour market supports continuous easing from the BoC
The Canadian economy failed to add jobs in March, with employment essentially flatlining on the month. Read more
Payrolls could confirm Fed’s caution
There's a risk that today’s jobs data doesn’t tip the balance for traders, especially if expectations of a 214k payrolls print and 0.3% wage growth are met. Read more
No change at the NBP
The National Bank of Poland maintained the policy rate at 5.75% for the sixth successive meeting, a move widely expected by markets. Read more
Swiss inflation cools in March, validating the SNB’s decision to cut
Inflation seemingly disappeared in Switzerland in March, just as underlying measures suggested the pace of price growth was reaccelerating. Read more
Dollar takes a breather after weaker ISM services PMI
With the Fed’s more cautious tone exerting pressure on currencies, signs that the data may soon turn more palatable sparked a relief rally across the board. Read more
Softer ISM Services should be treated with caution
The ISM services PMI dropped to 51.4 in March, down 1.2 percentage points from 52.6 the month prior and disappointing market consensus. Read more
Monex’s April 2024 FX Forecasts
Our market analysts believe expectations of monetary easing across the G10 are likely to diverge further in April. Here's Monex's latest FX forecasts for April. Read more
Dollar reopens with a firming bias heading into Powell and PMIs
Whether or not FX markets continue to trade in ignorance of this today will depend on the ISM services PMI, released at 15:00 BST. Read more
Starting Q2 with a stronger dollar
Markets spent the first quarter speculating on the Fed’s ability to cut rates, with the focus turning towards a flatter profile of easing in late March. Read more
Breaking for Easter but not higher for the dollar
Next week should start off quieter as the Easter holidays in many parts of the world bring reduced liquidity and limited price action across FX markets. Read more
Canada’s economy rises from its slump, but it’s not all good news
The Canadian economy grew 0.6% MoM in January, beating expectations and Statistics Canada’s flash estimate by 0.2 percentage points. Read more
Waller casts mildly hawkish tone
Governor Waller sounded notably more hawkish than Chair Powell when speaking at the Economic Club of New York yesterday. Read more
The Riksbank opens the door to rate cuts
The Riksbank left rates unchanged at 4.00% in their latest policy decision, but validated market expectations that the first rate cut could come in May. Read more
Governor Waller could trigger intervention in Asia
Tonight sees arguably the marquee event of the week with a speech by Fed Governor Waller, whose tone tonight will be crucial. Read more
The NBH slows the pace as domestic tensions weigh
The National Bank of Hungary cut rates by 75bps at today’s meeting, taking the base rate to 8.25%, in line with the market consensus and our forecast. Read more
Asian policymakers continue to steady the ship
With CNY and JPY weakness extending the dollar’s rally on Friday, all eyes yesterday were on whether policymakers would allow such price action to continue. Read more
PBoC pushes back
The focus this morning was on China and whether authorities would push back on market forces and publish the daily fix back below 7.10. Read more
Taking time to digest
After a week full of central bank policy decisions, in the coming week, markets will have further opportunity to digest these developments. Read more
Banxico cuts for the first time… but keeps the cautious stance
At its March meeting, Banxico's Board of Governors decided to cut its benchmark interest rate by 25 basis points to 11.00% for the first time this cycle. Read more
A break in the soft yuan peg
Today’s moves in USDCNY and those in the yen over the past week have made USD-Asia pairs more volatile and bringing life back into the options space. Read more
Bank of England lays the foundations to cut
The Bank of England has left Bank Rate unchanged at 5.25% once again, in line with consensus expectations and our forecast. Read more
BCB cuts 50 basis points, maintains its forecasts but turns more hawkish
At its March meeting, the BCB's Monetary Policy Committee (Copom) unanimously decided to cut the Selic rate by 50bps for the sixth consecutive time. Read more
March PMIs point towards a two speed Europe
March flash PMIs continue to highlight the contrasting fortunes of European economies. Read more
The SNB commences the G10 easing cycle
The Swiss National Bank today cut its policy rate by 25bps to 1.5%, making it the first G10 central bank to cut rates this cycle. Read more
Markets breathe a sigh of relief as Fed confirms three cuts this year
The US dollar opens mildly weaker this morning as the Fed reaffirmed its confidence to cut rates this year. Read more
Fed reiterates confidence to cut this year, but risk of a higher terminal rate grows
FOMC members continue to predict 3 rate cuts this year, but have revised up the 2025/2026 median by 25bps and lifted the longer-term projection moderately. Read more
In the hands of the dots
Today, the focus for markets is on the other side of the equation in terms of interest rate differentials, as markets will finally hear from the Fed. Read more
UK inflation cools but not by enough to shift the BoE
Headline UK inflation dropped marginally more than expected in February, with prices rising by 3.4% on a YoY basis. Read more
BoC should cut in April, whether they will is another question
Across nearly all measures, inflation pressures in Canada cooled considerably in February, with headline inflation undershooting consensus expectations. Read more
SNB preview: Narrowly avoiding being the first to cut
Having effectively brought inflation back to within its target range, the SNB scans as the most likely candidate to kickstart the DM easing cycle. Read more
Bank of Japan “dovishly” exits negative rates and YCC
The Bank of Japan hiked interest rates for the first time in 17 years today, effectively exiting negative interest rates that had been in place since 2016. Read more
Norges Bank Preview: NOK rocking the ship
Whilst we see no risk of the Norges Bank adjusting rates this week, the extent to which the central bank updates its guidance will be important to markets. Read more
A jam packed data calendar awaits
FX markets drop down a gear as the lighter data calendar allowed traders to take stock, but this week an abundance of central bank meetings are in focus. Read more
Asian FX volatility to sprout in Spring
Implied and realised volatility should rise close to recent averages across a multitude of Asian currency pairs ahead of the Fed’s June meeting. Read more
UK economy rebounds in January
January’s monthly GDP print showed the UK economy expanded by 0.2%, fuelling hopes that a technical recession for the UK will remain a 2023 story. Read more
Hotter February inflation should turn BCB hawkish
Brazil's headline inflation was again slightly above economists' forecasts in February. Read more
US inflation keeps Fed easing bets before June at bay
US Headline inflation only just met expectations of a 0.4% MoM increase in February, with the unrounded figure printing at 0.442%. Read more
Marginal labour market cooling keeps the BoE on track for an August cut
January’s UK labour market data, released this morning, keeps the Bank of England on track for an August start to policy easing. Read more
Is the tide turning for the dollar?
Next week will see data releases from the US, Brazil, the UK, China and Poland, all of which pose notable questions for their respective currencies. Read more
Powell’s confidence is not misplaced
Today’s jobs report is the kind that should see confidence building at the Fed, as the headline NFP number indicated 275k jobs added in February. Read more
Strong job growth doesn’t justify the BoC delaying until June
For the second month this year, the Canadian economy added an above-trend level of jobs, with net employment increased by 40.7k in February. Read more
Lagarde all but shuts the door on an April cut
The ECB kept all policy rates unchanged once again in today’s decision, meeting both consensus expectations and our own pre-announcement call. Read more
BoC says it’s “too early” to ease
The Bank of Canada left its policy rate at 5% for a fifth straight meeting today, in line with the broad consensus. Read more
NBP holds rates, resumption of easing to be delayed
The National Bank of Poland today held rates at 5.75%, as widely expected with focus on the updated inflation forecasts and the future path of policy rates. Read more
The Chancellor delivers few pre-election boosts
The Spring Budget contained no meaningful pre-election surprises, leaving the path clear for the BoE to cut rates this year, most likely in August. Read more
Monex’s March 2024 FX Forecasts
With more central bank meetings set for this month, we think policymakers will have to recognise the growing divergence in economic fundamentals. Read more
Time to pick up the pace
Activity should ramp up again for FX traders, with the focus first on Switzerland followed by key central banks meetings for both the BoC and ECB. Read more
Canada’s economy can’t fulfil its potential despite beating expectations
The Canadian economy essentially flatlined in December following a 0.23% MoM increase in November, as measured on an industry basis. Read more
The NBH picks up the pace
The National Bank of Hungary cut rates by 100bp in their latest policy decision, taking the main policy rate to 9.00%, in line with market consensus. Read more
Inflation remains in focus
Next week, inflation dynamics will be in focus, with CPI data out of Japan, two central bank decisions, a Canadian GDP print and eurozone inflation data. Read more
Divergent fortunes between the UK and eurozone are on show once again
Green shoots of recovery should not distract from the reality that eurozone activity remains in contraction, highlighted today by eurozone PMI figures. Read more
April is now live again for a BoC cut
Thankfully for the BoC, January’s inflation data presented a clearer picture of disinflation, with all indices essentially reflecting weaker growth rates. Read more
PBoC provides more support to the housing market
The People’s Bank of China surprised market expectations, cutting the 5-year Loan Prime Rate (LPR) instead of the 1-year LPR. Read more
Realised vol to stay high next week
The reopening of Chinese markets and their response to last week’s move in US rates will likely keep volatility high at the start of the coming week. Read more
UK retail sales reverse the Christmas slump
January’s retail sales data should put to bed any doubts around the UK’s economic prospects heading into 2024. Read more
UK Q4 GDP figures confirm a 2023 technical recession
UK GDP data released this morning confirmed that the UK just barely fell into a technical recession at the end of 2023. Read more
UK inflation surprisingly fails to accelerate
January’s UK inflation numbers notably undershot expectations in this morning's release, countering yesterday’s hotter labour market figures. Read more
US CPI provides the Fed with another reason to hold
If the prospect of an interest rate cut from the Fed in March wasn’t yet dead, January’s inflation data has just provided the final bullet. Read more
SNB to weaken the franc ahead of March rate cut
Today's Swiss inflation data confirms our view that the SNB will loosen monetary policy, primarily through the exchange rate before cutting its policy rate. Read more
UK labour market continues to outperform expectations
Today's UK labour market data delivered yet another head scratching outturn, reinforcing our call for no policy rate easing in the first half of this year. Read more
UK and US data in focus as China celebrates Lunar New Year
In the coming week, the markets focus will return to G10 currencies, with a number of key data releases set to be delivered. Read more
Even Canada’s jobs data isn’t safe
Canada’s macroeconomic data has been incredibly noisy in recent months, making it nigh on impossible to accurately predict the state of the economy. Read more
January inflation and a more cautious Banxico point to the March meeting… as the soonest
Headline and core inflation in January continued to show the pace of disinflation in Mexico slowing at the beginning of the year. Read more
CNB rate cuts accelerate
The Czech National Bank (CNB) cut rates by 50bps this afternoon, taking the repurchase rate to 6.25%, delivering more policy easing than we expected. Read more
Further evidence that the BCB will have to be less optimistic
Headline inflation in Brazil came in slightly higher than economists expected at the beginning of the year. Read more
National Bank of Poland on hold, again
The National Bank of Poland held rates at 5.75% today, in line with our pre-announcement call and consensus expectations. Read more
A blow to easing bets
The focus for many FX traders will switch to emerging markets. However, developed markets still have their share of entertainment coming up. Read more
Monster US jobs print deals a blow to Fed easing bets
The US economy added a monstrous 353k jobs in January, beating consensus expectations of just 185k by a considerable margin. Read more
Monex’s February 2024 FX Forecasts
With markets having now unwound December’s moves, our FX analysts believe the scope for further US dollar appreciation looks more limited for February. Read more
Bank of England bides time before rate cuts
The Bank of England held rates at their first policy meeting of the year, a move widely expected by markets and in line with our pre-announcement call. Read more
BCB stays the course despite new faces
Yesterday, the BCB finally decided unanimously to cut the Selic rate by 50 basis points for the fifth consecutive time, to 11.25%. Read more
Eurozone disinflation hits a bump in the road
January’s preliminary eurozone inflation overshot expectations by 0.1pp, with headline CPI figures showing price growth of 2.8% on an annual basis. Read more
Fed takes next cautious step in the path to cuts
The Federal Reserve today held rates in the target range of 5.25-5.5% for the fourth consecutive meeting in a decision that was unanimously expected. Read more
Canadian economy looks set to rise from the ashes in Q4, albeit briefly
Preliminary GDP data for Q4 shows the Canadian economy tracking at an annualised rate of 1.2% QoQ. Read more
National Bank of Hungary had its hands tied
The NBH has cut the base rate by 75bps to 10%, undershooting the widespread consensus that looked for a larger 100bp cut. Read more
Focus turns back to the Fed
Next week should see monetary policy continue as a driver for FX markets, with the Fed is set to announce its first policy decision of the year. Read more
Lagarde cracks open the door to earlier rate cuts
In a move that surprised almost no-one, the ECB has held rates once again today, maintaining the deposit rate at 4.00% in line with market consensus. Read more
The CBRT delivers one final hike
The CBRT has hiked the one-week repo rate by 250bp to 45.00%, in line with our call and market consensus. Read more
Norges Bank declares an end to policy tightening
The Norges Bank has maintained the deposit rate at 4.50% as widely expected, in line with our pre-announcement call. Read more
The BoC pivot begins
The Bank of Canada maintained its policy rate at 5.00% in the first policy decision of the new year, in line with market consensus. Read more
European PMIs remain pointed in opposite directions
A marginal uptick in eurozone PMIs does little to dispel the notion that the bloc is well and truly stuck in contraction. Read more
Sticky inflation set to keep the BoE on hold in early 2024
UK inflation reaccelerated in December, with headline price growth rising to 4.0% YoY, up from 3.9% the month prior, surprising the consensus. Read more
A rise in core inflation pressures likely means a hawkish BoC next week
Canadian inflation accelerated in December, rising to 3.4% YoY in line with expectations, but still a 0.3pp increase on November’s 3.1% reading. Read more
The labour market continue to cool, but not fast enough to suggest imminent cuts from the BoE
UK wage data showed that pay pressures continue to cool, though not fast enough to see the Bank of England cutting rates until the second half of 2024. Read more
UK economy bounces back from October’s slumber
The UK economy grew by 0.3% in November, beating the 0.2% expansion anticipated by markets to completely reverse October’s decline. Read more
US CPI adds pressure to the market’s Fed view
Both US headline and core inflation printed at 0.3% MoM in December, with the former landing 0.1pp above expectations and the latter in line with consensus. Read more
Macro Outlook 2024: Not so fast – dollar to decline but rout unlikely
This year is set to see policy easing play out across most major economies, though our FX analysts foresee a bumpier ride than many are predicting for 2024. Read more
The NBP holds fire once again, as expected
The National Bank of Poland kicked off the year by maintaining rates at 5.75%, in line with unanimous sell-side consensus and our own pre-release call. Read more
Fed to remain cautious on conflicting labour market signals
December’s nonfarm payrolls delivered a beat to expectations, coming in hotter-than-expected and posing a significant challenge to markets. Read more
The curious case of Canada’s jobs market
The Canadian economy failed to add any jobs in December, with employment levels in full-time positions actually falling by 23.5k on the month. Read more
Fed meeting minutes show no signs of rate cut discussion, as intimated by Powell
Since Powell’s press conference, members of the FOMC have been actively trying to push back on the market's dovish view. Read more
European PMIs point to divergent economic fortunes heading into the new year
November’s PMI figures proved to be a false dawn for the eurozone, pointing to a less than merry Christmas for some European economies. Read more
ECB clings onto hawkish narrative, but moves on PEPP
The ECB unanimously held the deposit rate at 4%, despite simultaneously downgrading its 2024 growth, inflation, and core inflation forecasts. Read more
The Old Lady’s not for turning
As expected, and unlike the Fed last night, the BoE resisted the urge to pivot to a more dovish monetary policy stance. Read more
Krone weakness pushes the Norges Bank to deliver a final hike
The Norges Bank hiked the deposit rate by 25bps to 4.5% at its December meeting, defying the market consensus and our own call for the Bank to hold. Read more
SNB turns neutral on the franc
The Swiss National Bank held rates on Sight Deposits at 1.75% for the second consecutive meeting, in line with broad market consensus. Read more
Rate cuts draw closer for the Fed as the economy seen cooling
The Federal Reserve today tweaked its policy statement and Summary of Economic Projections in a progressively dovish direction. Read more
UK growth cools, but is set to recover
UK growth figures surprised to the downside, showing the economy shrank by 0.3% in October, below consensus estimates that looked for a 0.1% contraction. Read more
The pace of US disinflation starts to slow
Disinflationary progress in the US effectively stalled in November, giving the Fed further evidence to turn to tomorrow to relay a more cautious message. Read more
UK wage growth cools, but not enough to shift the BoE
UK labour market data delivered a downside surprise, confirming no further rate hikes are on the horizon from the Bank of England. Read more
November payrolls give Fed reason to be cautious
The US economy added 199k jobs in November, up from 150k in October and marginally above consensus expectations of 183k. Read more
Wait-and-see at the NBP
The National Bank of Poland has left policy on hold at 5.75% as expected in December, in line with our call and market consensus. Read more
BoC holds rates at 5%, delaying discussions of easing until 2024
The Bank of Canada held its policy rate at 5% today for the third successive meeting since it resumed its hiking cycle back earlier this year. Read more
Canadian labour market loosens despite strong job growth
November’s jobs report marks another mixed data release out of Canada. Headline employment growth once again proved strong. Read more
Monex’s December 2023 FX Forecasts
Whilst our FX analysts maintain a bearish view on the US dollar from mid-2024 onwards, they continue to envisage a stronger dollar heading into 24Q2. Read more
Choppy GDP data risks masking underlying weakness in Canadian economy
The first estimate of Q3 GDP showed the Canadian economy contracting -0.3% QoQ, or -1.1% in annualised terms. Read more
ECB’s 2% inflation target is in sight
The flash estimate of euro area inflation for November confirmed the disinflationary signals from the national data released over the past day. Read more
UK economy accelerates in November
November’s flash PMIs once again support Monex's view that the UK economy is merely in a state of stagnation as opposed to outright contraction. Read more
Riksbank gambles on external conditions keeping the krona supported
The Riksbank hit a pause on policy tightening this morning, leaving the main policy rate at 4.00% in a move that defied consensus expectations. Read more
Weak growth in Europe is starting to impact the labour market
The general theme across November’s flash eurozone PMIs is that the continued slowdown in economic growth is starting to manifest within the labour market. Read more
The Chancellor manages to deliver a modest surprise in the Autumn Statement
Despite largely confirming pre-announcement expectations, today’s Autumn Statement was somewhat more generous than many had initially anticipated. Read more
Inflation cools considerably in Canada at the start of Q4
Canadian headline CPI fell 0.7 percentage points to 3.1% YoY at the start of the fourth quarter, in line with economist expectations. This largely reflected lower gasoline prices (-7.8% YoY). Read more
UK inflation falls sharply as expected, adding to the probability of a soft landing
This morning's October CPI print saw UK inflation decelerate sharply, fractionally undershooting the market consensus. Read more
US core services inflation cools, sparking a relief rally against the dollar
US headline inflation fell from 3.7% to 3.2% YoY in October following a flat month-on-month reading, but the focus for markets remains on the core index. Read more
UK wages continue to slow under the surface, despite a headline beat
Whilst this morning’s UK labour market data release surprised to the upside on headline measures, the details of the report provide plenty of good news. Read more
Inflation in Sweden isn’t as worse as feared, but that shouldn’t stop the Riksbank from hiking
October’s inflation data out of Sweden undershot analyst expectations but continued to outpace the central bank’s September projections. Read more
Banxico dial down the hawkish guidance, consistent with early 2024 rate cuts
Banxico kept rates on hold at 11.25% at its November meeting in line with consensus and our forecast. Read more
UK growth exceeds expectations to flatline in Q3
UK GDP figures out this morning revealed a surprise 0.2% economic expansion in September, enough to keep the economy from contracting in the third quarter. Read more
Sticky services inflation to keep Banxico on hold
Headline inflation in Mexico continued to fall in October, in both annual and sequential terms. That is, risks to their inflation forecasts remain tilted to the upside. Read more
NBP leaves rates unchanged in a first post election policy decision
The National Bank of Poland has maintained the base rate at 5.75%, a surprise for markets that had projected a further 25bp cut to policy rates. Read more
Weakness in North American jobs data fuels rate cut speculation
At 150k, however, today’s US net employment figure considerably undershot expectations. Canada’s October jobs report came in similarly soft. Read more
Bank of England holds firm at 5.25% despite brewing growth concerns
The Bank of England has held the Bank Rate at 5.25% for the second consecutive meeting, in line with market consensus and our own pre-announcement call. Read more
No surprises from the Norges Bank, buts hints of a dovish pivot in December
The Norges Bank today kept policy rates on hold at 4.25%, as widely expected by markets and in line with our pre-release call. Read more
Powell keeps December rate hike alive
The FOMC unanimously voted to keep the policy rate on hold today at 5.25-5.5%, in what became a widely expected decision. Read more
Monex’s November 2023 FX Forecasts
November looks like it could bring much of the same as October, with the dollar's path higher set to remain stymied at least in part by rate dynamics. Read more
Another quarter devoid of growth leaves the BoC in limbo until 24Q1
The Canadian economy continued to flatline in August, as an increase in the services sector (+0.1% MoM) was netted off by a contraction in goods (-0.2%). Read more
ECB holds rates, minimum reserve requirements, and keeps PEPP reinvestment language
The ECB held its main policy rates today at its October meeting, marking the first pause after ten successive rate hikes since the cycle began in July 2022. Read more
US economy posts monster gain in Q3, but don’t expect a repeat
In today's release of US Q3 GDP data, the US economy expanded by 4.9% annualised in Q3, beating economist expectations for a 4.5% print. Read more
CBRT remains committed to the inflation fight
The Central Bank of the Republic of Turkey has raised the main policy rate by 500bp today, in line with broad market consensus. Read more
BoC hesitant to call an end to its hiking cycle
The Bank of Canada held rates at 5% for the second consecutive meeting since it resumed its hiking cycle with two consecutive 25bp hikes in June and July. Read more
US PMIs show the exceptionalism narrative still has legs
Flash PMI data for the US improved across the board, with S&P Global’s measures of manufacturing, services, and the composite all beating expectations. Read more
NBH cuts rates by 75bps, hints to faster than expected policy easing
The National Bank of Hungary announced a 75bp cut to the central bank base rate today, taking it to 12.25%. Read more
UK economy seen flatlining in the fourth quarter
The UK's latest flash PMIs show an economy flatlining, but not to an extent that recession appears more likely than not. Read more
October’s PMIs increase the likelihood of a eurozone recession in Q4
The eurozone’s flash PMIs made for grim reading yet again, raising the risk of an earlier and more aggressive easing cycle in 2024 than markets are pricing. Read more
Soft August retail sales confirm consumer demand slowdown in Canada
Canadian retail sales for August met expectations at -0.1% MoM, softening from a 0.3% print the month prior. Read more
Grim retail sales data takes further BoE rate hiking off the table
Retail sales data out this morning showed an alarming slide in consumer spending, putting the prospect of a UK recession back on the table for policymakers. Read more
Turning bearish on CAD as recession odds mount
After remaining relatively range-bound for most of 2023, growing geopolitical risks have led the Canadian dollar to depreciate towards year-to-date lows. Read more
UK inflation data posts a modest beat, but changes little for the BoE
UK inflation data out this morning delivered a modest beat, though it remains tracking below the BoE’s August forecasts. Read more
Cooler inflation in Canada crushes the chance of a hike next week
Headline inflation in Canada fell by two tenths of a percent to 3.8% YoY, as the monthly impulse turned negative at -0.1% MoM. Read more
The peak is now in for UK wage growth
Wage growth fell in August across all key measures in new data out this morning, providing welcome though widely expected relief on Threadneedle Street. Read more
BoC’s Q3 surveys paint stagflationary outlook
The outlook for the Canadian economy is bleak, as per the Bank of Canada’s latest Q3 surveys. We now look towards September’s inflation report tomorrow. Read more
Still bullish on MXN despite a more challenging environment
Our analysts expect the macroeconomic backdrop to remain challenging and consequently keep USDMXN volatile in Q4. Read more
Norges Bank is done hiking with inflation cooling quicker than expected
The release of September’s CPI report this morning saw price growth in Norway massively undershoot expectations. Read more
Thirteen is unlucky for some, but maybe not the dollar
Next week, in terms of economic events, the calendar provides plenty to excite markets. Read more
Massive job gains keep an October BoC hike on the table, but the job market isn’t as strong as it seems
Following an August report where a 40k gain doubled expectations, September saw Canada’s job gains more than triple the 20k consensus. Read more
Monstrous payrolls report keeps Q4 hike alive
Before today’s US payrolls release, markets were assigning less than a 40% probability of a Q4 rate hike, however that is no longer the case. Read more
The NBP returns to policy orthodoxy with a quarter point cut
The National Bank of Poland has followed up last month's surprise 75 basis point cut with a further 25bps today, bringing the policy rate to 5.75% Read more
Monex’s October 2023 FX Forecasts
This month, growth concerns predominate across advanced economies, whilst policy easing is increasingly a focus for emerging market central banks. Read more
Markets forced to trade in turbulent waters
In the coming week, increased levels of intraday volatility are likely to persist, with US political woes over the weekend, concerns over China and Friday's NFP report. Read more
Canada’s economy continued to stagnate into Q3
Canada’s economy didn’t grow or shrink in July, with month-on-month growth coming in a tenth below consensus estimates. Read more
Inflation data in Europe improves just as the outlook deteriorates
Inflation data in the eurozone is finally showing signs of breaking lower, to the relief of ECB policymakers. Read more
Upside in USDCHF to be capped by EURUSD downside and SNB intervention
Monex's base case is for SNB intervention to result in EURCHF trading within the current 0.95-0.97 range for the remainder of this year. Read more
The race to the bottom begins for CE3 central banks
For CE3 economies, the focus of monetary policy is now definitively on the prospect of rate cuts. Read more
Monex’s September 2023 FX Forecasts
Our Monex analysts continue to favour the greenback against yield (JPY) and growth sensitive (EUR and CNY) currencies over the next month. Read more
SEK Update
Our analysts see the stage as set for a significant fall in EURSEK in the second half of the year and on into 2024. Read more
Monex’s August 2023 FX Forecasts
With the risk of the Fed hiking once more in Q4 still credible, we expect the shallow and bumpy downtrend in the dollar to continue throughout Q3. Read more
Expect more GBP downside on underwhelming BoE
Our analysts expect the Bank of England will hike 25bp in August following weak inflation data leading to further depreciation in the pound. Read more
Monex’s July 2023 FX Forecasts
Although the global tightening cycle is approaching its final phase, monetary policy remains one of the primary drivers of FX market price action. Read more
Monex’s June 2023 FX Forecasts
Market price action over the past month was dominated by the twin themes of political dysfunction and economic convergence. Read more
Monex’s May 2023 FX Forecasts
With central banks in the US and elsewhere hitting the end of their hiking cycles, we see near-term policy expectations losing some impact on FX volatility. Read more
Monex’s April 2023 FX Forecasts
Whilst our FX Analysts' March forecasts have broadly panned out, it was the driving force behind these moves that came as a surprise to them. Read more
Monex’s March 2023 FX Forecasts
Our FX analysts expect a reversal in some of February's price action on the back of reduced upside risk to US rates and potentially reduced volatility within the space. Here's a look at the latest Monex FX Forecasts for March 2023. Read more
Monex’s February 2023 FX Forecasts
The market's repositioning has been quite aggressive to date, leading us to believe that the dollar is overdue a period of consolidation in the near-term. Read more
Macro Outlook 2023: The macro climate remains challenging for investors
Following a volatile year defined by rising inflation pressures, the macro environment is unlikely to ease up for investors in 2023. Read more
Monex’s December 2022 FX Forecasts
Our house view has now shifted tactically neutral on the US dollar in the near term and await a shift in structural factors to trigger a secular decline in the dollar. Read more
Monex’s November 2022 FX Forecasts
For now, our outlook on the dollar remains constructive until jobs and inflation data allow the Fed to downshift. Read more
Monex’s October 2022 FX Forecasts
Although a high level of bond market volatility is filtering through to FX markets our analysts believe the dollar has a structural basis to grind higher in Q4. Read more
Week Ahead: Fire sale in markets may not ease despite thinner data calendar
In the week ahead, the economic calendar dies down slightly, although the start to the week might not be frictionless as traders return with the results of Italy’s latest election. Read more
SGD Outlook: Singapore dollar to rally against currency basket on MAS tightening
In spite of the fundamentals, the risks to our USDSGD outlook skew to the downside as APAC central banks may intervene in FX markets to prevent excessive depreciation in their respective currencies. Read more
Monex’s September 2022 FX Forecasts
Our forecasts are more bullish on the dollar as we no longer expect the Fed’s downshift to 50bps in September to be as supportive for risk conditions. Read more
Monex’s August 2022 FX Forecasts
DXY index is likely to stay supported, owing to our expectation that the euro-area’s growth outlook will force another run on parity this month. Read more
Monex’s July 2022 FX Forecasts
Read Monex's July 2022 FX Forecasts. Find our what our top forecasters expect for currency markets, amid ongoing recession concerns and higher inflation. Read more
Monex’s June 2022 FX Forecasts
Read Monex's June 2022 FX Forecasts. Find our what our top forecasters expect for currency markets, amid ongoing global growth and inflation concerns. Read more
Monex’s May 2022 FX Forecasts
Read Monex's May 2022 FX Forecasts. Find our what our top forecasters expect for currency markets, amid current geopolitical events and uncertain conditions. Read more
CAD Outlook: Loonie strength to continue in Q2 on higher oil and BoC support
The Canadian dollar has been highly sensitive to monetary policy actions and price action in global commodities over the course of Q1. Under our base case for commodities and the Bank of Canada in Q2, which envisages two 50bp hikes, we believe gains in the Canadian dollar are likely to continue. However, our flatter forecast for the BoC policy rate in H2 will likely weigh on the loonie at the margin as the pace of Fed tightening overtakes that of the Bank of Canada. Read more
Monex’s April 2022 FX Forecasts
While the limited progress in peace talks towards the end of the month blurred the overall dollar dynamics due to a positive boost to regional risk sentiment, we still expect some of the dominant drivers of FX markets from March to remain in play in April. Read more
EUR Update: European currencies battered by latest Russia-Ukraine headlines – is there a floor?
Since the publication of our latest FX forecasts at the beginning of the month, significant developments in the Russia-Ukraine war have put increased pressure on European currencies and equities. Over the last month, the respective currencies of these nations have therefore performed even worse than the euro. The question now is; where will price action stabilise? Read more
CHF Update: Consolidation below parity in EURCHF is unlikely
While the Swiss franc is considered a global safe haven, we have long argued that its haven attributes are more acute during periods of regional risk. This has been visible over the past weeks, as rising political and economic risks have significantly impacted the European growth outlook. Read more
Monex’s March 2022 FX Forecasts
Geopolitical events are likely to continue driving FX markets in the near-term and with no clear end game as things stand, our forecasts remain under review. Our base case scenario at present is that the pace of geopolitical developments slow in March, but recent events result in a material deterioration in Europe’s macroeconomic backdrop and a still tentative risk environment. Read more
EUR Update: Fluid backdrop to keep volatility elevated
The ongoing political risk in Europe means EURUSD is going to remain an easy target within the G10, while rising US Treasury yields the euro’s sensitivity to them will also be a risk. Looking over to H2, an improvement in global growth conditions will be more deterministic for the euro when the monetary outlook and political backdrop has become more stable. Read more
Monex’s February 2022 FX Forecasts
Looking ahead, our FX analysts expect the dollar’s strength to be more nuanced in February and for it to be isolated against currencies where rates are likely to lag the rise in US rates. In our forecasts, this largely pertains to EUR, JPY and CNY. Read more
BRL Outlook: Hawkish BCB to offset depreciation, but political risks may tip the balance
As the year progresses, the Brazilian general elections that are set to be held in October will become increasingly relevant for FX markets given the real’s reputation of weakening in times of political uncertainty and upcoming elections. Read more
USD Outlook: Factoring in the stall in hawkish Fed pricing
Since the Federal Reserve’s December meeting, the DXY index has fallen by 1.5% despite data released over the same timeframe for December showing the unemployment rate falling below 4% and inflation data rising to a near 40-year high. Read more
Monex’s 12 key market themes for 2022
Trade ideas tend to have a short shelflife in today's market, so instead of issuing trade suggestions for 2022, we have opted to outline the main themes we think will dominate market price action in the coming 12 months. Read more
Monex January 2022 FX Forecasts
Looking ahead to 2022, our forecasts have been adjusted to take into account the new sensitivities of central banks to inflation, continuing virus risks and the likely slowdown in growth in Q1. Omicron risk continues to dominate as policymakers conduct a balancing act in order to mitigate the health and economic impacts. Read more
Monex December 2021 FX Forecasts
The Omicron variant has certainly thrown another spanner in the works for our currency forecasts. With little information known about the efficacy rate of vaccines against the Omicron variant and therefore the impact it will have on global growth, we project our near-term forecasts based on the scenario of no substantial deterioration in Covid conditions towards year-end. Read more
Projected rate paths are key for NZD and SEK
Next week (22nd - 26th November), focus remains on how markets price central bank tolerances to inflation and global growth conditions as Covid cases begin to rise and force major nations to impose tighter containment measures. Read more
US CPI keeps markets volatile following the central bank bonanza
Next week (15th - 19th November), CPI remains top of mind as a number of nations are set to release reports highlighting above target price growth, however, we believe these releases will have less of an impact on broader markets relative to the US release this week. Additionally, central banks from South Africa and Turkey are expected to deliver fresh rate decisions. Read more
RUB: Positive outlook riddled with risk
While most arrows point in favour of a RUB rally, a major downside risk to the currency outlook has emerged as the Covid case count, along with related deaths and hospitalisations, stand at record-highs and first steps have been taken to slow the surge. Read more
ECB and Fed speakers in scope after dovish retaliation
Next week (8th - 12th November), despite the absence of any major central bank meetings, the focus will remain on monetary policy pricing, especially as the Fed’s media blackout period ends. Notable speeches from Chicago Fed Evans and San Francisco’s Daly will be in scope for US rate traders, while opening remarks from the ECB’s Chief Economist Lane will be top of mind for euro money markets. Read more
NOK and SEK to rise further before rally tops out
Looking ahead, we expect both NOK and SEK to remain strong until year-end, but next year could see more limited gains as the procyclical rally is expected to be less pronounced than previously thought given downgrades to global growth. Read more
The central bank magic trick: turning a dove into a hawk in plain sight
Price action in G10 FX markets this week has been driven predominantly by pricing in bond markets and the actions of central banks. This dynamic is set to continue next week (1st - 5th November) as the battle against rising inflation migrates from the Bank of Canada and the ECB to the Reserve Bank of Australia, the Federal Reserve, and the Bank of England. Read more
Central banks to take centre stage ahead of crucial GDP readings
A flurry of central bank meetings take will place across the globe next week (25th - 29th October), while Q3 GDP prints from the US and eurozone will take centre stage on Friday. Several countries will also release inflation readings. Among the central bank meetings are the Bank of Canada, the Bank of Japan and the European Central Bank - in order of importance. Read more
EUR Update: Euro weighed down by near-term factors, medium-term outlook rosier
While September’s losses were significant at over 2%, we expect the pressure on the euro to ease over the coming months as supply pressures mitigate, which should help to cool inflation and aid growth conditions. We expect the combination of these developments to be supportive for EURUSD. Read more
Economic activity and inflation data put stagflation fears to the test
Next week (18th - 22nd October), the data calendar revolves around October’s preliminary PMI prints, while China’s Q3 GDP data also scans as one of the more interesting releases. The focus on activity data is likely to be heightened given growth concerns over previous weeks and the impact higher input costs are having. This is especially the case in the eurozone, UK, and China, where rising energy costs are the most pronounced. Read more
USD Update: Defiant dollar in Q4
Our latest forecasts now see the DXY index trading a percentage point lower than current spot levels and back towards highs of its previous trading range as the aggressive repricing in FX markets overextended in early October given our views on back-end US rates this year. Read more
Macro backdrop of slower growth and rising inflation set to dominate FX markets
Next week (11th - 15th October), with a limited data calendar, markets are likely to continue focusing on the inflation backdrop and the impact it will have on growth conditions. We take a brief look at the environment in Europe this week and what it means for ECB and BoE pricing. Read more
Grappling with the stagflationary backdrop
Next week (4th - 8th October), the central banks’ assessments of the stagflationary environment will be in focus for markets, especially as traders adjust positions following this week’s aggressive price adjustments. Read more
KRW Update: Further won weakness to be limited
A combination of slowing semiconductor exports, higher yields in the DM space, and a resurgence of Covid-19, have all contributed to the unwind in aggressive USDKRW short positioning this year. Read more
From policy announcements to central bank speakers
Next week (27th September - 1st October), the focus quickly shifts from policy announcements to individual central bankers as a swathe of speakers fill the economic calendar, largely due to the ECB’s forum on central banking taking place between the 28th and 29th of September. Rather than being in Sintra (Portugal) as has been customary, the event will take place online. Read more
Monetary policy in scope with FOMC minutes and ECB strategy review
This week (5th - 9th July), the meeting minutes from the Fed’s June meeting will be scoured by market participants as they try to gain a clearer view on future US interest rates, and the ECB’s Governing Council is set to also meet next week in Frankfurt to discuss the ongoing policy review. Read more
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