Aussie and kiwi lead losses as global shares tumble
Global concerns over the impact of the Iran war pushed US shares lower, with the benchmark S&P 500 closing at its lowest level since 21 November.
The US dollar surged on safe‑haven demand, with the USD index hitting a four‑month high.
In Australia, expected inflation jumped to 5.2% in March, the highest since July 2023, according to the Melbourne Institute’s latest survey.
Despite this, AUD/USD fell 1.0% yesterday. Near‑term support sits around 0.7067, followed by 0.6965.
The kiwi also came under pressure, with NZD/USD down 1.0%.
In Asia, USD/CNH rose 0.1%, while USD/SGD gained 0.4%.
US inflation edges up but signals remain mixed
January PCE data is released tonight and is expected to show the Federal Reserve’s preferred inflation measure running somewhat firmer than CPI.
Earlier in the week, US headline inflation rose slightly in February, with CPI up 0.27% on the month. The annual rate barely changed, edging up from 2.39% in January to 2.41% in February.
Core CPI was also close to expectations, rising 0.22% for the month. Its annual pace eased modestly, slipping from 2.50% to 2.46%.
Even so, the monthly core increase remains slightly above the pace typically consistent with the Federal Reserve’s 2% inflation goal.
Japan confidence slips as weak JPY adds pressure
Japan’s manufacturing sentiment softened in Q1, with the BSI large manufacturing index easing to 3.8 from 4.7, falling short of expectations.
Geopolitical tensions and higher oil prices weighed on confidence following earlier cuts to investment plans.
Bank of Japan Governor Kazuo Ueda noted that the weak yen is now having a stronger impact on prices than in the past, shaping inflation expectations as energy costs rise.
Together, these trends point to growing cost pressures even as activity cools, increasing the likelihood that the BoJ may need to adjust policy sooner if currency‑driven inflation persists.
USD/JPY is trading near a two‑month high. Initial support sits near 156.88, followed by 156.18, where USD buyers may look to step in.
USD at four-month highs
Table: seven-day rolling currency trends and trading ranges
Key global risk events
Calendar: 9 – 14 March
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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.
