Psychology for major markets Feb 25
USD Lower Again, Risk and Metal Broadly Positive
EUR/USD – The Euro rebounds in the Asia session but has not shown signs of commitment yet. Germany Q4 GDP bangs in estimate and thus is not providing any cues for Euro traders.
USD/JPY – The pair is still in consolidation phase. Despite multiple ex-BoJ officials voiced out their concern on Takaichi's stimulus, it is hard to see current BoJ officials or Ueda to disregard the will of the Japanese PM and hike rate immediately. Without any clarity, the pair will likely be steered by USD flows.
EUR/GBP – The pair is little changed and waiting for next leg.
AUD/USD – The Aussie is riding on strong metal and positive risk sentiment. Combined with stronger than estimate CPI, RBA's hawkish stance is reinforced and encourage market participants to speculate earlier rate hikes from the RBA.
Equities – Broader risk atmosphere is positive but no winds on their sail. Precious metal continues to benefit from geopolitical uncertainty.