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Daily Pivots: (S1) 157.72; (P) 158.69; (R1) 159.40; More...

Intraday bias in USD/JPY remains neutral as consolidations continue below 159.88. Another falling leg could be seen, but downside should be contained by 38.2% retracement of 152.25 to 159.88 at 156.96 to bring rebound. On the upside, break of 159.88 will target a test on 161.94 high.

In the bigger picture, outlook is unchanged that corrective pattern from 161.94 (2024 high) should have completed with three waves at 139.87. Larger up trend from 102.58 (2021 low) could be ready to resume through 161.94. This will remain the favored case as long as 55 W EMA (now at 152.70) holds. Firm break of 161.94 will pave the way to 61.8% projection of 102.58 to 161.94 from 139.87 at 176.75.

Daily Pivots: (S1) 1.3300; (P) 1.3389; (R1) 1.3522; More...

Range trading continues in GBP/USD and intraday bias remains neutral for the moment. With 1.3482 resistance intact, further decline is in favor. On the downside, below 1.3216 will resume the fall from 1.3867 to 1.3008 structural support. However, decisive break of 1.3482 will argue that the fall from 1.3867 has completed, and turn bias back to the upside for 61.8% retracement of 1.3867 to 1.3216 at 1.3618.

In the bigger picture, considering bearish divergence condition in both D and W MACD, a medium term top should be in place at 1.3867. Firm break of 1.3008 support will argue that fall from 1.3867 is at least correcting the rise from 1.0351 (2022 low) with risk of bearish reversal. That would open up further decline to 38.2% retracement of 1.0351 to 1.3867 at 1.2524. For now, medium term outlook will be neutral at best as long as 1.3867 resistance holds, or until further development.

Daily Pivots: (S1) 0.7819; (P) 0.7879; (R1) 0.7924; More….

Intraday bias in USD/CHF remains neutral and more consolidations could be seen below 0.7957. As noted before, rise from 0.7603 should be correcting whole decline from 0.9200. Above 0.7957 will target 38.2% retracement of 0.9200 to 0.7603 at 0.8213. This will remain the favored case as long as 0.7746 support holds.

In the bigger picture, a medium term bottom should be in place at 0.7603 on bullish convergence condition in D MACD. Rebound from there is seen as correcting the fall from 0.9200 only. However, decisive break of 55 W EMA (now at 0.8085) will suggest that it's probably correcting the larger scale down trend from 1.0146 (2022 high). On the other hand, rejection by the 55 W EMA will setup down trend resumption to 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382 at a later stage.

Daily Pivots: (S1) 1.3679; (P) 1.3717; (R1) 1.3765; More...

Immediate focus is now on 1.3751 resistance in USD/CAD. Decisive break there will suggest that stronger rebound is underway, probably as a correction to whole down trend from 1.4791. Further rally should be seen to 1.3927 resistance first. On the downside, below 1.3669 will bring retest of 1.3480/3524 support zone.

In the bigger picture, price actions from 1.4791 are seen as a corrective pattern to the whole up trend from 1.2005 (2021 low). Deeper fall could be seen, as the pattern extends, to 61.8% retracement of 1.2005 to 1.4791 at 1.3069. However, break of 1.3927 resistance will argue that the correction has completed with three waves down to 1.3480 already.

Daily Pivots: (S1) 0.6927; (P) 0.6995; (R1) 0.7079; More...

Focus stays on 0.6943 support in AUD/USD after the volatility in the last 24 hours. Decisive break there should confirm rejection by 0.7206 key fibonacci resistance. That would set up deeper correction to the whole up trend from 0.5913, and target 38.2% retracement of 0.5913 to 0.7187 at 0.6700. Nevertheless, strong rebound from current levels would retain near term bullishness for breakout through 0.7187 at a later stage.

In the bigger picture, current development argues that rise from 0.5913 (2024 low) is reversing whole down trend from 0.8006 (2021 high). Decisive break of 61.8% retracement of 0.8006 to 0.5913 at 0.7206 will pave the way back to 0.8006. This will remain the favored case as long as 0.6706 resistance turned support holds, even in case of deep pullback.

Dollar remained resilient as markets attempted to price in a tentative “peace pivot”, but with skepticism over its credibility limiting any sustained risk rally. Asian equities opened higher following the rebound in US markets overnight, but gains were modest, with major indexes recovering only about half of the previous day’s losses.

The initial optimism was driven by US President Donald Trump’s decision to postpone planned strikes on Iranian energy infrastructure for five days after what he described as “very good and productive” conversations. The announcement encouraged markets to unwind some of the extreme escalation risks that had been priced in following the earlier 48-hour ultimatum.

However, this narrative quickly ran into a credibility wall. Tehran dismissed the claims as “fake news” and “psychological warfare,” casting doubt on whether any meaningful diplomatic progress had been made. The conflicting signals have left markets hesitant to fully embrace the idea of de-escalation.

On the ground, developments have reinforced this caution. Reports of explosions over Jerusalem following Iranian missile fire highlight that hostilities remain active despite the rhetoric of talks. This disconnect between words and actions has kept investors wary of a sudden “snap-back” in tensions.

Oil markets reflect this skepticism. Brent crude rebounded back above 100, indicating that traders are not pricing in a lasting resolution. The persistence of elevated oil prices continues to anchor inflation expectations and limit the scope for a broader risk-on move. In equities, the muted rebound underscores the lack of conviction. The market is effectively caught between relief from delayed escalation and concern over unresolved risks.

Currency markets are showing a clearer expression of this dynamic. Dollar is the strongest performer for the day so fart. Yen is also firm on safe-haven demand, while Canadian Dollar benefits from oil strength. In contrast, Australian and New Zealand Dollars remain under pressure, reflecting their sensitivity to global growth and Asia-linked risks. Sterling is also softer, while Euro and Swiss Franc are trading in the middle as markets await clearer direction.

The next 96 hours are critical. The five-day pause is conditional on the “success of ongoing meetings,” leaving open the possibility that the original threat to strike Iranian infrastructure could return if progress stalls. This binary outcome is keeping volatility elevated.

Until there is concrete evidence of de-escalation—either through a joint statement or the reopening of the Strait of Hormuz—markets are likely to remain trapped in a headline-driven cycle. For now, the dominant theme is cautious positioning, with the Dollar’s resilience reflecting a market that is not yet ready to fully price in peace.

Elsewhere, Australia and the European Union formally signed a long-awaited free trade agreement after years of negotiations. The deal removes tariffs on Australian critical minerals, and includes a broader Security and Defense Partnership.

The agreement is being framed as a move toward supply chain diversification at a time of heightened geopolitical risk. By opening European markets further to Australian resources, it reduces reliance on China while strengthening support for the global energy transition, particularly in critical mineral supply chains.

In Asia, at the time of writing, Nikkei is up 0.43%. Hong Kong HSI is up 1.32%. China Shanghai SSE is up 0.64%. Singapore Strait Times is up 0.15%. Japan 10-year JGB yield is down -0.042 at 2.280. Overnight, DOW rose 1.38% S&P 500 rose 1.15%. NASDAQ rose 1.38%. 10-year yield fell -0.057 to 4.334.

Japan core CPI falls to 1.7% in February, as energy costs drag inflation lower

Japan CPI data point to easing inflation momentum driven by energy costs, though core-core inflation suggests underlying pressures remain. Read more.

Japan PMI composite falls to 52.5, war lifts costs and hits sentiment

Japan’s PMI data show growth cooling as input costs surge and business sentiment weakens. The Middle East conflict is lifting energy prices and disrupting supply chains, squeezing margins and raising uncertainty. Read more.

Australia PMI composite falls to 47, cost inflation hits 3-yr high on Middle East conflict

Australia’s PMI data signal a sharp shift into contraction as demand weakens and cost inflation surges to a three-year high. The combination highlights early stagflation risks as the Middle East shock begins to hit growth and prices. Read more.

RBNZ's Breman warns of inflation spike but cautions against overreaction

RBNZ Governor Anna Breman warns the Middle East conflict will lift inflation while weighing on growth, but stresses policy must avoid overreacting to temporary shocks. The focus remains on preventing short-term price spikes from becoming persistent inflation. Read more.

AUD/USD Daily Report

Daily Pivots: (S1) 0.6927; (P) 0.6995; (R1) 0.7079; More...

Focus stays on 0.6943 support in AUD/USD after the volatility in the last 24 hours. Decisive break there should confirm rejection by 0.7206 key fibonacci resistance. That would set up deeper correction to the whole up trend from 0.5913, and target 38.2% retracement of 0.5913 to 0.7187 at 0.6700. Nevertheless, strong rebound from current levels would retain near term bullishness for breakout through 0.7187 at a later stage.

In the bigger picture, current development argues that rise from 0.5913 (2024 low) is reversing whole down trend from 0.8006 (2021 high). Decisive break of 61.8% retracement of 0.8006 to 0.5913 at 0.7206 will pave the way back to 0.8006. This will remain the favored case as long as 0.6706 resistance turned support holds, even in case of deep pullback.

Japan’s inflation slowed further in February, with core CPI (ex-fresh food) easing from 2.0% yoy to 1.6% yoy, below expectations of 1.7% yoy. The drop pushed core inflation below the Bank of Japan’s 2% target for the first time in nearly four years, largely reflecting government measures to curb electricity costs.

The decline was driven primarily by falling energy prices. Energy costs dropped -9.1% yoy after -5.2% yoy in January, with gasoline prices plunging -14.9% yoy and electricity bills falling -8.0% yoy. This sharp easing in energy inflation offset still-elevated food prices, where costs excluding fresh items rose 5.7% yoy, albeit moderating from 6.2% yoy previously.

Broader inflation indicators also softened. Core-core CPI (ex-fresh food and energy) edged down from 2.6% yoy to 2.5% yoy. Headline CPI fell from 1.5% yoy to 1.3% yoy, marking the lowest level since March 2022 and a fourth consecutive monthly slowdown.

Japan’s private sector growth lost momentum in March as PMI data showed a broad-based slowdown across both manufacturing and services. PMI Manufacturing fell from 53.0 to 51.4, PMI Services eased from 53.8 to 52.8, and PMI Composite declined from 53.9 to 52.5, pointing to softer expansion after a strong start to the year.

The slowdown coincided with a sharp rise in input costs, with inflation accelerating to its fastest pace in nearly a year. According to S&P Global, higher energy prices and supply chain disruptions linked to the Middle East conflict were key drivers, alongside a weaker Yen and rising labor costs. While factory gate prices increased more quickly, service providers raised charges at a slower pace, resulting in a squeeze on margins.

S&P Global’s Annabel Fiddes noted that growth in output, new orders, and employment all moderated, with firms becoming more cautious amid heightened uncertainty. Confidence weakened, particularly in the services sector, as companies grappled with rising costs and unclear demand prospects. While manufacturers remain somewhat optimistic due to global demand in sectors such as AI and semiconductors, the overall outlook has become more uncertain as the war-driven shock feeds through the economy.

Full Japan PMI flash release here.

Australia’s private sector slipped into contraction in March as PMI data signaled a sharp deterioration in activity. PMI Manufacturing edged down from 51.0 to 50.1. But the real drag came from services, where PMI Services plunged from 52.8 to 46.6. As a result, PMI Composite dropped from 52.4 to 47.0, marking its weakest level since December 2023.

The data highlight a clear loss of momentum in demand, particularly across the services sector. According to S&P Global’s Eleanor Dennison, business activity contracted for the first time in a year-and-a-half, reflecting a fresh drop in demand for both services and manufactured goods. The deterioration in sentiment suggests that firms are becoming more cautious as external conditions worsen.

At the same time, inflation pressures are intensifying. Input costs rose sharply, with composite cost inflation hitting its highest level in over three years, while output charges climbed to their strongest since August 2023.

Dennison noted that the figures offer an early indication of how the Middle East conflict is feeding through to the global economy, with Australian firms facing rising costs, supply chain disruptions, and weakening demand—pointing to emerging stagflation dynamics.

Full Australia PMI flash release here.

RBNZ Governor Anna Breman warned that the Middle East conflict is likely to push New Zealand’s economy into a more challenging environment of higher inflation and weaker growth. Speaking today, she said policymakers expect “higher headline inflation over the near term, and somewhat weaker growth momentum,” highlighting the stagflationary nature of the shock stemming from elevated energy prices and global uncertainty.

Beyond inflation and growth, Breman pointed to "global financial stability risks", noting that global stress could affect funding conditions for New Zealand banks. However, she emphasized that the domestic banking system remains resilient, with strong capital and liquidity buffers. Recent stress tests suggest banks are “well-placed to weather severe geopolitical shocks,” offering some reassurance despite the volatile global backdrop.

On policy, Breman stressed the importance of avoiding a premature response to "temporary inflation spike" that monetary policy cannot directly address, while also guarding against the risk of inflation becoming entrenched. The committee will remain vigilant to ensure that temporary price pressures do not translate into persistent inflation, reaffirming that delivering low and stable inflation over the medium term remains the central objective.