1. Reports
  2. Daily FX Report
Non-independent Research

Daily FX Report

Read disclaimer


The Euro maintained a firm tone into the New York, although the dollar was able to demonstrate some residence as the single currency struggled to extend gains. There were further reservations over the EU vaccine programme as EU Commission President von der Leyen admitted that there were significant difficulties. Germany stated that current lockdown measures would not end until at least March 7th, maintaining reservations over the near-term outlook.
ECB President Lagarde stated that inflation was not converging to the goal over the medium term and that the accommodative monetary policy must continue.
US consumer prices increased 0.3% for January which was in line with expectations, although the year-on-year rate was held at 1.4% compared with consensus forecasts of 1.5%. Energy and clothing prices strengthened sharply on the month, but car sales declined. Core prices were unchanged on the month, below expectations of a 0.2% increase and the annual rate slowed to 1.4% from 1.6% and below forecasts of 1.5%.
The CPI data helped sooth market concerns over the risk of higher inflation and the dollar lost ground with the Euro pushing to just above 1.2140 before stalling with little change into the European close with a reluctance to chase the Euro higher despite the weak dollar tone.
Fed Chair Powell reiterated that the current pace of bond buying would continue until substantial further progress had been made towards maximum employment and price stability. He also stated that the US was a long way from full employment and monetary policy would not be tightened solely in response to a strong labour market. Powell repeated that the Fed will aim to achieve moderately above 2.0% for some time.
The overall rhetoric was dovish and broadly in line with recent comments and the dollar reaction was measured with the Euro settling around 1.2130. Underlying dollar sentiment remained fragile on Thursday, but it was able to resist further significant selling with the Euro around 1.2125.


The dollar looked to pare losses ahead of the New York open, although overall progress was still limited. There were reports that the Bank of Japan would look to strengthen forward guidance at the March meeting and warn that interest rates could be pushed deeper into negative territory. The comments undermined the yen to some extent, especially with speculation that the Finance Ministry would also look to curb further yen gains.
Bond yields moved lower following the US inflation data which curbed potential US currency demand and Wall Street equities also dipped after the open.
Risk conditions were stable following Powell’s comments with the dollar around 104.65 as ranges narrowed.
Chinese and Japanese markets were closed on Thursday which limited activity and the dollar was held around 104.60 amid the overall soft tone.


Sterling maintained a firm tone during Wednesday with markets continuing to probe resistance areas against the dollar. The UK currency continued to gain underlying support from the vaccination programme as the proportion of the population receiving at least one jab increased to above 18.5%.
The EU stated that it wanted an extension until April 30th to ratify the EU/UK trade deal. There was little net impact, although markets still fretted over evidence of trade difficulties under the new regulations, especially surrounding Northern Ireland, which could have a negative impact on UK growth.
Bank of England Governor Bailey made no comments on monetary policy in his comments as he concentrated on financial regulation and standards.
With the dollar still under pressure, Sterling strengthened to fresh 33-month highs above 1.3850 against the dollar while the Euro retreated slightly to around 0.8760.
The RICS house-price index retreated to 50 for January from 63 the previous month and below consensus expectations of 60, reinforcing the trend of a slowdown in the sector. Sterling overall held a firm tone to trade around 1.3850 against the dollar while the Euro retreated slightly to near 0.8755.


The Swiss franc resisted selling pressure ahead of Wednesday’s New York open and gained an element of support as US equity markets moved lower. The Euro edged below the 1.0800 level while the dollar dipped to fresh 2-week lows below the 0.8900 level.
The franc resisted fresh selling despite the decline in Italian bond yields and generally firm risk conditions. The Euro was held just below 1.0800 on Thursday with the dollar close to 0.8900 as overall risk conditions held steady and volatility remained lower.



This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

Sign-up to get the latest Non-independent research

We will email you each time a new report has been published.

You might also be interested in...

Daily Report Base Metals

Our daily commentary, covering market news and closing prices of LME aluminium, copper, lead, nickel, tin, zinc, iron ore, steel, and precious metals.

Daily Report Softs Technical Charts

Technical analysis and charts for the key sugar, cocoa and coffee contracts.

Weekly Report FX Options

Commentary and analysis covering OTC currency option pricing, volatility and positioning. This week we focus on USDSGD and whether the SDG recent strength is sustainable given the deteriorating global outlook. 

Quarterly Metals Report – Q3 2022

Our analysts provide an in-depth analysis of the metals market and current macroeconomic conditions. The environment has weakened significantly as growth fears rise amid persistent high inflation. Central banks are data-dependent, which could mean they slow rate hikes as growth starts to slow. This has meant a downside to the US 10yr yield, but also we see a downside to rate hikes in Q4. Europe will likely enter a recession before the US and take longer to recover, but material availability is significantly lower, shown by low inventories.

FX Monthly Report June 2022

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we look into the JPY and the pressure the BOJ is under to change their monetary policy as JPY continues to weaken against major currencies. Economic data is weakening and inflation is less of a problem in Japan, but yields continue to test the cap.