USD stronger as Fed warns on inflation
US technology stocks rebounded overnight, with the Nasdaq index rising 0.9% after its more‑than‑7% slide since late January.
Tech stocks have been hit by growing concerns about the impact of AI on profits. According to Bloomberg, the broader US software sector is down 20% this year versus a steady S&P 500.
In FX markets, the focus was on a stronger US dollar after Federal Reserve members Austan Goolsbee and Raphael Bostic warned that higher inflation means the Fed has less room to cut rates.
AUD/USD was broadly steady ahead of today’s key inflation reading. The annual headline CPI is forecast to edge down from 3.8% to 3.7% — still far too hot for the Reserve Bank of Australia. Australian CPI is due at 11.30am AEDT.
NZD/USD gained 0.2%.
USD/CNH fell 0.1% while USD/SGD was flat.
The Japanese yen saw the largest losses overnight, with USD/JPY up 0.7%.
Aussie flat as Trump weighs new national security tariffs
The Trump administration is considering fresh tariffs on industries including large‑scale batteries, power‑grid equipment, and telecom gear, according to the Wall Street Journal.
The measures would fall under Section 232 of the Trade Expansion Act of 1962, which allows the president to impose tariffs on national‑security grounds. These would be separate from the Section 301 tariffs already announced following the Supreme Court ruling.
The Australian dollar was flat overnight and has now slipped 1% from its recent high of 0.7147, last seen on 12 February.
Key support sits at the 21‑day EMA of 0.7014, followed by the 50‑day EMA of 0.6888.
Despite the pullback, AUD/USD remains near the top of its six‑month trading range.
US led January JPY checks, eyed joint action
US authorities drove January’s “rate checks” that lifted the yen and signalled readiness for joint intervention if Japan requested it, according to the Nikkei. Acting for the Treasury, the New York Fed stepped in without a request from Japan’s Ministry of Finance, amid concerns that election‑year uncertainty could ripple through global markets.
Treasury Secretary Scott Bessent pushed the move as an initial step toward possible yen‑buying after the currency slid near 160 per dollar. The Fed later confirmed it sought dealer quotes at the Treasury’s request, raising expectations of the first US–Japan joint intervention in 15 years.
USD/JPY is now 3% below its 14 January peak of 159.45. The next resistance stands at the 50‑day EMA of 155.26, with dollar buyers eyeing opportunities at current levels.
USD gains on Fed chat
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 23 — 28 Feb
All times AEDT
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*The FX rates published are provided by Convera’s Market Insights team for research purposes only. The rates have a unique source and may not align to any live exchange rates quoted on other sites. They are not an indication of actual buy/sell rates, or a financial offer.
