Our base case would be that BoJ FX intervention in the current environment can at best put a lid on USD/JPY in the 162/165 area rather than turn the trend. Taking into account high energy prices and Japan running substantially negative real interest rates, plus the dollar being in demand, Tokyo cannot expect a sustained drop in USD/JPY. A joint US-Japanese intervention to sell USD/JPY would be far more significant than solely Japanese intervention. Here, not only would Washin

The US Dollar Index (DXY) has a well documented seasonal tendency to weaken in April and then rebound in May. This opens up a traditional “upside seasonal” window from late April through the end of May, during which the greenback has historically seen positive average returns in most years. The pattern is one of the more consistent in FX seasonality studies and is seen across multi-decade datasets. What's behind the upside? April weakness frequently leaves the dollar oversold

The RBA's Monetary Policy Board increased the target for the official cash rate by 25 basis points to 4.35% (effective 6 May 2026). This marks the third straight 25bp hike in 2026 (following hikes in February and March). Inflation: The headline CPI is now forecast to reach a peak of 4.8% in mid-2026 (higher than in the February projection). The underlying inflation rate (trimmed mean) is expected to remain above 3% until mid-2027, before easing back towards the target band of

Below you will find the historical cumulative performance of a G10FX momentum factor benchmark index during the first quarter of 2026. The benchmark is rebalanced monthly; this quarter it mainly shifted positions in the long leg side of the equation while the short leg ranking held steady. Over the 77 trading periods, the total return was 1.09%, holding onto gains despite the Middle East tensions. Gains above 2.0% were reached before the middle of March, when the strategy pos

RBA pricing has shifted upward significantly (from expected cuts to expected rises), while Fed pricing has shifted sideways or slightly higher (fewer/delayed cuts than anticipated at the start of 2026). Markets price zero to one Fed 25bp cut in 2026, often pushed back to late in the year (e.g., September–December) or priced out entirely post-Iran conflict. Australia faces stickier inflation above the 2–3% target band, driven by strong activity and resource utilization. The US

A continuation of the 2025 weakness in the dollar was seen early this year as the market priced in Fed monetary policy, Trump trade tensions, and geopolitical concerns on Greenland. The war risk premium saw this softness reversed in late February; the dollar got a bid out of safe haven demand and the oil price channel. Our own dollar index shows this reaction function. However, the bid failed to top the early January levels. An alternative measure, the DXY, concentrates weigh

RaboResearch maintains our forecast of the next move in the OCR being a 0.25ppt hike to arrive at the October meeting . We project a follow-up 0.25ppt hike in Q1 of next year to take the OCR up to 2.75% with a high likelihood of more to follow as the RBNZ seeks to shift monetary policy to ‘neutral’, which they estimate to be an OCR of 3-3.25%. RaboResearch maintains a baseline forecast that the Strait of Hormuz will begin to slowly re-open from late April onwards. Even if thi

In the FX market, interest rate differentials have not been the main driver, and EUR/USD expectedly jumped on the news of a ceasefire. We note that even amidst bouts of flight-to-safety, the performance of the USD has been far from stellar, and the conflict in the Middle East has not at least bolstered the confidence towards the dollar in the medium term. We thus continue to expect a clearly higher EUR/USD towards the end of our forecast horizon . - Nordea

The CBOE Volatility Index <.VIX> just delivered one of the clearest macro signals of 2026 so far: a sharp drop below the psychologically critical 20 level. After spiking above 30 amid Middle East tensions in March, the index is set to record the seventh largest two-week decline on record. For FX traders this meant an opportunity to rewrite the book as dips below 20 <.The VIX> are historically tied to a risk-on regime change, where high-beta FX tend to outperform the rest oof

The real driver behind AUD strength is the interest-rate differential. As of April 14, 2026, the 10-year AGB yield sits at approximately 4.93%, while the equivalent U.S. 10-year Treasury yields 4.27%—a spread of roughly +66 basis points in Australia’s favor. RBA rate hikes in February and March (lifting the cash rate above the Fed’s for the first time in years) pushed Australian yields higher while U.S. yields remained relatively anchored or eased on growth concerns. The 2-ye

On average, EMFX has fallen to the U.S. dollar since the Iran conflict started. However, we have seen relative strength playing out as not all currencies share the same commodity/oil dependency status. Playing a long BRL / short TRY is a classic EMFX relative value cross trade. The strategy bets that BRL will outperform TRY, driven by Brazil’s oil exporter stance versus Turkey’s vulnerability as a major energy importer with high inflation and structural pressures. Since the I

Real policy rates — calculated as the latest nominal policy rate minus headline CPI — remain one of the strongest fundamental drivers of G10 currency performance in 2026. The chart below includes data up to April 2, 2026. I continue to see statistical relevance in the Q3 sample. This is beacuse higher (or less negative) real rates tend to attract capital inflows, support carry, and reinforce currency strength, especially during periods of geopolitical stress like the current

The momentum strategy profits from trend persistence and has historically delivered strong risk-adjusted returns in trending, risk-on environments while struggling in choppy or sudden regime shifts. Year-to-date, the factor has posted modest positive returns, estimated in the +3.5% to +6% range net of transaction costs (based on typical bank-published momentum baskets and cross-sectional implementations). Early-year strength came from the continuation of 2025’s USD weakness t

Most G10 yield curves experienced bear flattening: short-term yields (1Y/2Y) rose significantly more than long-term yields (10Y/30Y). UK gilts led the charge with front-end moves of ~+65–72 bps on the 2Y, while the 30Y lagged at ~+32 bps. Germany saw an even more pronounced version: 2Y up ~+43 bps vs. 30Y only +10 bps. This pattern reflected markets pricing in near-term inflation spikes from energy costs, while longer-term growth concerns (potential recessionary drag from hig

History suggests readiness for the ECB to react to higher energy prices despite limited signs of broader inflation pressures. While inflation had broadened a lot in 2022, when the ECB hiked rates, the same cannot be said about the hikes in 2008 ahead of the global financial crisis and in 2011 in the middle of the euro-area debt crisis. While we are on the verge of moving our baseline ECB hikes from 2027 clearly forward, we have not done so yet. We still tend to think it would

The outcome of this meeting reinforced our long-held view that the easing cycle will end at 6.50%, with the timing of the final cut dependent on the duration of the conflict. The combination of weak domestic demand, still-contained underlying inflation pressures, tighter financial conditions, and a still strong peso, supports completing the cycle. Moreover, inflationary pressures in Mexico should be more contained than in most countries, as higher gasoline prices are unlikely

A breakthrough the 160.0 level is holding on Friday into close. Here's a summary of USD/JPY recent performance: This Week (5-day): +0.43% to +1.69% This Month (March 2026): +2.47% to +2.86% (average rate ~157.61) Year-to-Date (2026): +2.13% to +2.90% 52-Week Range: 139.89 – 160.41 (currently near the all-time 2026 high) 2026 YTD High: ~159.90–160.41 (reached mid-March) 2026 YTD Low: ~152.46–152.69 (late January) Upper 21d Bollinger band caps upside at 160.36 USD/JPY remains s

March has proven to be a challenging month for both equities and bonds, leading to increased alerts from trading desks regarding potential USD buying signals across the G10 currency bloc. The situation has been particularly precarious for the Euro (EUR) and the Japanese Yen (JPY). The Eurozone's reliance on energy imports makes the Euro especially susceptible to fluctuations in energy prices, which can be exacerbated by geopolitical tensions and supply chain disruptions. This

Over 20 years of historical data, AUD/USD has shown clear seasonal tendencies. April stands out as the top-performing month on average, followed closely by March. This aligns with broader long-term patterns (back to the 1970s) where AUD often benefits from commodity flows, risk sentiment, and end-of-Q1 rebalancing. Looking at the last 20 years, AUD/USD has risen 0.83% on average in April; this has a 53% win ratio. The March-April window holds the best stats for AUD/USD upside

The oil plunge is triggering a textbook relief rally across cross-asset markets today. Brent crude is down 10-14% (hovering ~$99-100 after briefly dipping to $96), WTI ~8-11% lower around $88-90. This stems directly from Trump's announcement of "productive talks" with Iran and postponement of strikes on energy infrastructure/Hormuz threats—easing immediate supply shock fears that had priced in a $7-10/bbl geopolitical premium earlier. Equities: Strong rebound. Dow surging 600