USD/JPY: the Bank of Japan could not stop the fall of the yen

During Thursday's Asian session, AUD/USD shows an active decline, developing the corrective impulse formed on Tuesday. Quotes are testing the 0.6340 level for a downward breakdown, while market participants are evaluating the February Australian labor market data released earlier.The seasonally adjusted employment rate decreased by 52.8 thousand after rising by 30.5 thousand in the previous month, which turned out to be significantly worse than the forecast of 30.0 thousand. The indicator of full—time employment decreased by 35.7 thousand (after an increase of 36.9 thousand), and part-time employment - by 17.0 thousand (after a decrease of 6.5 thousand). The share of the labor force in the total population decreased from 67.2% to 66.8%, which is also lower than expected at 67.3%.The Reserve Bank of Australia (RBA) cut the interest rate by 25 basis points to 4.10% at its February meeting. Currently, the markets estimate the probability of continued dovish rhetoric at the May meeting and a third rate cut by the end of the year at 65%. However, RBA Assistant Governor Sarah Hunter said that the regulator remains more cautious than the market regarding further monetary policy easing.Results of the US Federal Reserve meetingInvestors are analyzing the results of the US Federal Reserve meeting, published the day before. As expected, the regulator kept the key rate at 4.50%, but adjusted its forecasts for the current year and the near future. The median rate forecast for the current year has been reduced from 4.40% to 3.90%, for 2026 from 3.90% to 3.40%, and for 2027 from 3.40% to 3.10%.The Fed also raised expectations for inflation and unemployment for the current year, but lowered its forecast for GDP growth. Inflation in 2025 is expected to reach 2.7% against the previous estimate of 2.5%. The unemployment rate may reach 4.4%, which is 0.1% higher than the previous forecast. The growth rate of the US economy in 2025 has been revised from 2.1% to 1.7%.Fed Chairman Jerome Powell stressed that there is no need to rush to adjust monetary policy, as the economy remains strong. However, uncertainty in macroeconomic forecasts has increased due to the US administration's trade policy, the effects of which on inflation are still difficult to assess.AUD/USD technical analysis for todayOn the daily chart (D1), the Bollinger indicator indicates a flat trend. The MACD indicator turned down, preparing to form a sell signal. Stochastic is also showing a decline.Trading recommendations- We will consider sales after the breakdown down to the level of 0.6319. The nearest target will be 0.6250. We will place the stop loss at 0.6350.- Purchases will become possible when growth resumes and the level of 0.6373 breaks up with a target of 0.6450. The stop loss is 0.6340.

Betting decisions: key events of the dayToday, the markets are focused on the decisions of three Central Banks at once — the Bank of England (BoE), the Swiss National Bank (SNB) and the Riksbank.The Bank of England is expected to keep the rate at 4.50%, which is in line with analysts' forecasts and current pricing in the market. The regulator's rhetoric is likely to remain unchanged, emphasizing the need for a gradual easing of monetary policy.In turn, the SNB is likely to cut the rate by 25 bps, to 0.25%, given the low inflation risks and weak dynamics of price pressure. Market expectations are also leaning in favor of a reduction, putting about 20 bps of mitigation in prices.The Riksbank is likely to leave the rate unchanged at 2.25%. However, there is a possibility of softer rhetoric, which may come as a surprise to the markets, given that the current market assessment suggests the possibility of a further step towards a rate hike.A Regional review of Norges Bank is also being released today. Investors will closely monitor GDP growth forecasts for the first and second quarters. According to preliminary data, economic activity is likely to remain in the range of 0.3–0.4% QoQ, which corresponds to the regulator's forecast made in December. However, special attention will be paid to capacity utilization indicators, as they play a key role in forecasting inflation and the subsequent trajectory of interest rates.Overview of economic events and market newsChina: sability of monetary policyThe People's Bank of China left key rates at the same levels: 1-year Loan Prime Rate — 3.10%, 5-year Loan — 3.60%. The decision was expected, but the market reaction remained restrained. The published economic data show a mixed picture of the state of the Chinese economy at the beginning of the year.The Fed's decision and the markets' reactionThe Fed, as expected, kept the rate unchanged. Jerome Powell presented a balanced statement, highlighting the existing risks, but at the same time making it clear that the regulator was in no hurry to change policy. As a result of this:• U.S. government bond yields have declined,• The dollar weakened,• Stock markets have strengthened.We still expect the first rate cut to take place in June, and the Fed may conduct three rounds of easing in total this year.Ukraine: negotiations with the United StatesThe telephone conversation between the Presidents of Ukraine and the United States was an important step in discussing long-term security guarantees. The main focus was on the prospects for a settlement of the conflict and a possible truce. However, at this stage, no real agreements on Ukraine's security have been reached yet.Stock market dynamicsGlobal markets ended the trading session with growth. In the US, indexes closed near daily highs as investors reacted positively to the outcome of the Fed meeting.• Dow Jones +0,9%• S&P 500 +1,1%• Nasdaq +1,4%• Russell 2000 +1,6%European markets have seen profit-taking after recent growth, especially noticeable in Germany, where the DAX has gained 17% since the beginning of the year.In Asia, trading takes place in different directions: the Japanese and Chinese markets are showing a decline, while the rest of the sites are mostly growing.European index futures are stable, while US futures indicate a possible continuation of growth, especially in the technology sector.Currency and debt marketsThe decisions of the Fed and the Bank of Japan led to a weakening of the dollar against the yen: USD/JPY fell below 149 after a decline in US bond yields reinforced the bearish trend against the dollar.EUR/USD remained near 1.09, while EUR/SEK rose above 11.00 again ahead of the Riksbank meeting.

GBP/USD review on March 20, 2025The British pound continues to show resilience against the US dollar. GBP/USD is correcting around 1.2979. The main factor supporting the pair is the weakening of the US currency, as well as positive data from the UK labor market.The statistics for January showed stability. The unemployment rate remained at 4.4%, while employment increased from 107.0 thousand to 144.0 thousand, and the number of applications for unemployment benefits increased from 2.8 thousand to 44.2 thousand. These indicators indicate a strong labor market, which in turn can support consumer spending and economic activity.The key event for the pound today will be the Bank of England meeting (14:00 GMT+2). The rate is expected to remain at 4.50%, with the majority of votes cast in favor of maintaining the policy (7 vs. 2). Investors are focused on the regulator's comments on future steps. Experts suggest that two more rate changes may follow this year, but the first easing of monetary policy is likely not earlier than summer.Additional uncertainty on the market is caused by the impact of US trade duties, as well as the entry into force of the new British budget, which provides for higher taxes for businesses. These factors may increase the pressure on economic growth and change the position of the monetary authorities.US Dollar: pressure from the FedThe dollar index continues to decline and reached 103.00. The greenback has been testing this level for the third day in a row. The Fed meeting did not support the national currency.As expected, the regulator left the rate unchanged in the range of 4.25–4.50%. However, the statements of Fed Chairman Jerome Powell turned out to be somewhat softer than expected. He stressed that the forecasts for inflation and economic growth have been revised down, which requires a moderate adjustment of the monetary policy rate. In particular, it was decided to slow down the reduction in the balance sheet, which includes a more restrained pace of sales of government bonds and mortgage-backed securities.These comments provoked a decline in US Treasury bond yields and a weakening of the dollar, which, through currency correlation, supported demand for risky assets, including the pound.Technical analysis of GBP/USD for todayOn the daily chart, the pair remains below the resistance line of the ascending channel, the range of which is limited by the levels of 1.3210–1.2830.The indicators indicate a predominance of bullish sentiment:• The moving averages (EMAS) of the Alligator indicator are moving up, strengthening the buy signal.• The Awesome Oscillator (AO) histogram is in the positive zone and increases the volume of correction bars, which confirms the upward trend.Trading Recommendations• Purchases are possible after the breakdown and price consolidation above 1.3050. The target is 1.3260. The stop loss is 1.2950.• Sales can be considered with a decline and consolidation below 1.2950. The target is 1.2700. The stop loss is 1.3020.Thus, the short-term outlook for GBP/USD will depend on the outcome of the Bank of England meeting and the market's reaction to the regulator's comments. In the case of a softer tone of the statement, the pound may adjust downwards, but in the medium term there remains a chance for a resumption of growth.

The EUR/JPY currency pair turned down after testing the resistance zone around 163.80. This level has repeatedly limited the pair's growth since January, which confirms its importance for the market. Additional pressure was exerted by the upper limit of the Bollinger Bands indicator, signaling an overheated market.The formation of the Shooting Star candle pattern on the daily chart indicates a weakening of the upward momentum and the possible development of a downward correction. This pattern, especially in combination with the key resistance, increases the likelihood of a further decline in quotes.The Stochastic indicator in the daily range is in the overbought zone, which further confirms the likelihood of a corrective movement. The immediate target of sellers is the support level of 161.00, where the market may find interest in buying again.

USD/CHF amalysis on March 19, 2025After an active decline over the previous two days, when USD/CHF updated the lows on March 10, the pair showed a slight correction on Wednesday. Quotes are testing the 0.8770 level for a downward breakout. Market participants are awaiting the outcome of the US Federal Reserve's monetary policy meeting.Experts are almost certain that the Fed will keep its key interest rate at 4.5%. However, the market's attention will be focused on clarifying the long-term prospects for monetary policy. Donald Trump's protectionism, with a sharp increase in import duties, puts pressure on the stability of the dollar.The US macroeconomic data is also worrisome. In February, industrial production grew by 0.7% month-on-month, exceeding the forecast of 0.2%. The level of production capacity utilization increased to 78.2% against expectations of 77.8%. The volume of construction started increased sharply from -11.5% to 11.2%, reaching 1,501 million, which was also higher than the forecast of 1.38 million.February data on Switzerland's foreign trade will be published on Thursday at 09:00 (GMT+2). Previously, exports amounted to 24.45 billion francs and imports to 18.33 billion francs, resulting in a trade surplus of 6.12 billion francs.A meeting of the Swiss National Bank (SNB) will be held at 10:30 (GMT+2). According to a Reuters poll, 90% of 32 economists expect an interest rate cut to 0.25%, where it will remain until at least 2026. This decision is supported by the low inflation rate, which reached a four-year low of 0.3% in February. However, the weakness of the Swiss franc may create risks of rising prices in the near term.USD/CHF technical analysis for todayOn the daily chart (D1), the Bollinger Band indicator indicates a mixed trading pattern in the short term. The MACD indicator is declining, forming a weak sell signal. Stochastic is showing a more confident decline, being near the oversold zoneTrading recommendations- We will consider selling after the breakdown down to the level of 0.8758 with a target of 0.8669. It is recommended to set a stop loss of 0.8800.- Purchases are possible after a rebound from the 0.8758 level and an upward breakdown of 0.8800. The target is 0.8900. The stop loss is 0.8758.

The US dollar continues to strengthen in the Asian session on Wednesday. USD/JPY is developing an upward momentum that began a week ago. The pair is testing the 149.60 level for an upward breakout and remains near the local maximum of March 5. The main event for the market was the meeting of the Bank of Japan, following which the regulator unanimously kept the interest rate at 0.50%, which fully coincided with analysts' expectations.The Bank of Japan's statement noted that the country's economy is showing a moderate recovery, although negative trends remain in some sectors. Industrial production and exports remain stable, but trade barriers imposed by the administration of US President Donald Trump pose additional risks. In particular, 25 percent duties on steel and aluminum, as well as possible new tariffs on car imports, could put pressure on the Japanese auto industry. Inflation remains above the target level: the core consumer price index reached 3.2%, which forces the regulator to think about further tightening monetary policy. However, the specific terms of the rate review were not announced. Last year, the Bank of Japan raised the interest rate by 25 basis points twice, in March and July.Additional attention was drawn to Japan's foreign trade data for February. Exports grew by 11.4% after 7.3% a month earlier, although an increase of 12.1% was expected. Imports, on the contrary, slowed sharply, falling 0.7% after January's 16.2% increase. As a result, the trade balance shifted from a deficit (-2758.8 billion yen) to a surplus (584.5 billion yen), although the consensus forecast assumed an increase to 722.8 billion yen.A meeting of the US Federal Reserve System will be held today at 20:00 (GMT+2). Analysts are almost unanimous in the opinion that the regulator will keep the interest rate at 4.50%. However, the attention of market participants will be focused on the Fed's rhetoric regarding future prospects. The protectionist policy of the Donald Trump administration, accompanied by rising import duties, is putting pressure on the dollar. Additionally, the situation is complicated by weak macroeconomic data, which increases fears of a recession.USD/JPY technical analysis for todayOn the Daily chart, the Bollinger indicator is in a horizontal movement position, which signals a decrease in volatility and a limited growth potential in the short term. The MACD indicator maintains a steady buy signal. Stochastic, approaching the overbought zone (level 80).Trading recommendations• Long positions are recommended after a confident breakout of the 150.00 resistance with a target of 151.50. A protective stop loss is 149.20.• A return to the "bearish" scenario with a breakdown of 149.09 down may be a signal for sales with a target of 148.00. Stop loss — 149.60.

FOREX Fundamental analysis for EUR/USD on March 19, 2025The Bundestag's approval of the fiscal stimulus project proposed by Friedrich Merz has already been played out on the market. Investors who have been actively building up long positions in the euro may start taking profits. Asset managers have brought their net euro long positions to a 5-month high, and forex hedging shows a significant reduction in short positions.Against this background, the upcoming meeting of the FOMC (Federal Committee on Open Market Operations) may be a key trigger for further movement of the EUR/USD pair.Jerome Powell in the current conditions resembles a duck, which is calm on the surface, but actively works underwater. Formally, the situation in the US economy looks stable, with economic growth continuing and inflation slowing. However, trade wars remain a serious risk that can change the current dynamics.Traders will closely monitor the forecasts of the FOMC members. In December, officials expected two rate cuts in 2025, but in March they may revise their own forecasts. Citi suggests that the number of declines may increase to three, given the cooling economy and the recovery of the disinflationary trend. However, there is also the opposite scenario. The Fed may reduce the forecast to one reduction or even abandon it due to the risks of stagflation, a process when economic growth slows and inflation accelerates.Markets are in uncertainty. A week ago, derivatives assumed a rate cut of 71 basis points (equivalent to three steps), but before the March FOMC meeting, these expectations dropped to 57 basis points. This happened despite a series of weak data, including a slowdown in consumer price growth and retail sales.Reputable organizations such as the OECD and Fitch Ratings express skepticism about further easing of the Fed's monetary policy. The OECD has stated that the cycle of monetary expansion is completed at least until the end of 2025. Fitch Ratings lowered its forecast for US GDP growth this year from 2.1% to 1.7%, and next year from 1.7% to 1.5%. This is significantly lower than in 2023-2024, when the economy grew by about 3%.Possible scenarios for EUR/USDThe outcome of the FOMC meeting will determine the further dynamics of the EUR/USD pair. If the Fed restricts itself to a single rate cut or abandons it altogether, this may provoke the fixation of long positions in the euro. On the contrary, three rate cuts may push the pair to the level of 1.1000. If the December forecasts are maintained, the pair is likely to move sideways. A drop below the level of 1.0890 will be a sales signal.

AUD/USD analysis on March 18, 2025On Tuesday, AUD/USD continues its upward movement and is trading at 0.6374. The Australian dollar is recovering after a short-term decline caused by the Reserve Bank of Australia (RBA) meeting last week. The weakening of the US dollar contributes to the formation of a stable upward trend, which allows quotes to stay above the interim annual maximum of 0.6400.Reserve Bank of Australia officials stress the need for restraint in further easing monetary policy. They intend to carefully assess macroeconomic indicators and the impact of the recent interest rate cut by 25 basis points.Meanwhile, the tourism sector is showing signs of recovery. In January, the volume of international trips reached a multi-year record: the number of short-term arrivals increased by 17.6% year-on-year, reaching 710,040 thousand. The short-term profitability of residents increased by 10.9%, amounting to 1.544 million Australian dollars. The total number of arrivals increased by 12.3% to 2.383 million, and departures abroad — by 16.3% to 2.031 million.The US dollar index is strengthening slightly and recovered to 103.10. The instability of the dollar is related to macroeconomic reports that did not meet market expectations. For example, retail sales in February increased from -1.2% to 0.2%, which was lower than the forecast of 0.6%. The core retail sales index increased from -0.6% to 0.3%, in line with expectations, but without having a significant impact on the market.AUD/USD technical analysis for todayOn the daily chart, the AUD/USD pair is approaching the resistance line of the ascending channel, the boundaries of which are in the range of 0.6500–0.6100.Technical indicators reinforce buy signals. The averages on the alligator indicator are pointing upwards. The awesome oscillator (AO) indicator has formed several ascending bars in the positive zone, which confirms the potential for further growth.Trading recommendations- Long positions: can be considered after the price rises and fixes above the level of 0.6400 with a target of 0.6530. It is recommended to set the stop loss at 0.6320.- Sales are relevant after the price drops and fixes below the level of 0.6350 with a target of 0.6200. The stop loss is 0.6430.