USD weaker after tariff takedown
The US dollar was mostly lower over the weekend as markets reacted to the US Supreme Court decision against President Donald Trump’s tariff program.
The Supreme Court found that using “emergency powers” laws to introduce long‑standing tariffs is illegal.
President Trump responded by announcing new tariffs of first 10% and then later 15%. These new tariffs will also face legal challenges.
The AUD/USD was the best performer, with the pair up 0.4%. NZD/USD gained 0.1%.
The euro and British pound saw small gains, while the JPY fell.
In Asia, USD/SGD and USD/CNH both fell 0.1%.
Australia’s growth cools as inflation heats up
Australia’s private sector lost steam in February, with the S&P Global flash composite PMI slipping to 52.0 from 55.7. Both services (52.2) and manufacturing (51.5) slowed as new business cooled and confidence fell to its weakest since mid‑2024.
Employment growth hit an 11‑month high, helping firms manage workloads, but cost and selling price pressures jumped to five‑month highs on rising wages, energy, and input costs. The mix of softer growth and hotter inflation sets up a tougher policy backdrop in the near term.
AUD/USD remains below its 12 February peak of 0.7147. Key support sits at the 21‑day EMA of 0.6998, with the 50‑day EMA at 0.6871 in focus.
CPI blitz sets tone for currencies
The week ahead is dominated by inflation releases, setting the tone for FX markets. In Asia, Singapore’s January CPI (Monday) and Australia’s CPI (Wednesday) will be closely watched for signs of persistent price pressures. Japan’s Tokyo CPI (Friday) offers an early read on national inflation trends, while the Eurozone, France, and Germany all report February CPI prints later in the week. These data points will be pivotal for rate expectations, especially as central banks remain cautious.
China’s Loan Prime Rate decisions (Tuesday) are expected to remain unchanged at 3.5% (5‑year) and 3.0% (1‑year), signalling a steady policy stance as authorities balance growth and financial stability. No major G10 central bank meetings are scheduled, keeping the focus on data rather than policy surprises.
US data releases include Factory Orders (Tuesday), Consumer Confidence (Wednesday), and PPI (Saturday), providing insight into the world’s largest economy. In Europe, Germany’s IFO Business Climate (Monday) and Eurozone Economic Confidence (Thursday) will gauge sentiment amid ongoing uncertainty. Japan’s Industrial Production and Retail Sales (Friday) will be key for the yen, while Singapore’s Industrial Production (Thursday) offers a pulse on regional manufacturing.
With no major holidays, liquidity should remain robust, but the concentration of inflation data could drive volatility, especially in EUR, JPY, and AUD pairs. Markets will be sensitive to any upside surprises in CPI, which could revive hawkish rate expectations. Conversely, softer prints may reinforce the case for policy patience.
Aussie best after tariff news
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.
