AUD/USD dips near 0.7110 in Asia, but may find support from the RBA’s cautious outlook
AUD/USD fell for a second straight session and traded near 0.7110 in Asia on Friday. Further losses may be limited if the Australian Dollar strengthens, as markets expect a cautious Reserve Bank of Australia (RBA).
Markets expect the RBA to keep the cash rate at 3.85% at the March meeting. Policymakers will not receive the full Q1 inflation report until late April, and Governor Michele Bullock has said patience is still appropriate, with the economy close to balance.
Australia’s private sector credit rose 0.5% in January, missing the 0.7% month-on-month forecast
Australia’s private sector credit rose 0.5% month-on-month in January. This was below the expected 0.7%.
This update compares the latest monthly growth rate with the market forecast. It shows that credit growth was slower than expected.
Cooling Loan Demand Signals
January private sector credit growth missed forecasts, rising only 0.5%. This suggests loan demand from both businesses and households is cooling more than expected. It may point to an economy that is losing momentum heading into the first quarter of 2026. Slower credit growth also gives the Reserve Bank of Australia (RBA) more room to stay cautious on policy. Markets may start to price in a lower chance of further rate hikes this year. This strengthens the case that the RBA’s next move could be a cut, possibly sooner than previously expected. This result also matches other recent data. The latest quarterly inflation figures released in January for Q4 2025 showed headline CPI still trending down, falling to 3.4%. The unemployment rate has also edged up to 4.2%. Together, these signals support the view of a cooling economy. For currency traders, this outlook may weigh on the Australian dollar. If rate expectations in Australia soften while the U.S. outlook stays uncertain, AUD/USD could come under pressure. One approach is to use strategies such as buying AUD put options to hedge or position for a potential decline in the coming weeks. For equity traders, the effect could be mixed, which may create opportunities for options traders. Slower credit growth can hurt bank earnings and other cyclical stocks. However, the chance of earlier rate cuts can support overall valuations. This push-and-pull could lift volatility in the S&P/ASX 200, making strategies that benefit from larger moves—such as long straddles—more appealing.Implications For Rba Outlook
In 2024 and 2025, the RBA held rates steady for long periods once inflation showed clear signs of peaking. That history suggests the Bank responds to signs of weakness and may avoid tightening too far. This supports the view that the RBA could lean more dovish in the near term. Create your live VT Markets account and start trading now.During early Asian trading, EUR/USD hovered near 1.1800 as soft Eurozone inflation offset uncertainty over US tariffs
EUR/USD traded near 1.1800 in early Friday trading. Softer Eurozone inflation offset worries about US tariffs. Traders waited for Germany’s preliminary CPI, while the US PPI report was also due.
A US Supreme Court ruling struck down the administration’s wide use of emergency powers to impose tariffs. After that, President Donald Trump set a blanket 15% tariff on imports.
US Trade Representative Jamieson Greer said Wednesday that Trump plans to lift the rate to 15% for many countries in the coming days. The authority lasts 150 days unless Congress extends it.
EU lawmakers on Monday delayed approval of the bloc’s trade deal with the US. They cited uncertainty over US tariff policy. The delay followed questions about how US measures could change.
Eurozone inflation fell to 1.7% in January, the lowest in 16 months. Core inflation also eased to 2.2% year on year. This raised expectations that the European Central Bank may turn more dovish, which could weigh on the euro versus the dollar.
Looking back to early 2025, EUR/USD stayed in a tight range near 1.1800. The market was pulled in two directions. US tariff fears could weaken the dollar, while low Eurozone inflation hurt the euro. The result was little clear trend, but high tension under the surface.
At the time, uncertainty around the 15% US tariff became the key theme. It also added to inflation pressure. US core PCE, the Fed’s preferred inflation measure, later rose to 3.8% by Q3 2025. That surprise kept the Federal Reserve from cutting rates as many had expected.
On the euro side, the weak 1.7% inflation reading in January 2025 was an early warning. The ECB did turn more dovish and cut its deposit facility rate by 25 basis points in June 2025. This policy split was a main driver of euro weakness through the rest of the year.
This period shows that political headlines can overwhelm economic data. They can also trigger sharp moves and higher volatility. In Q2 2025, implied volatility on 3-month EUR/USD options jumped more than 30% after the tariff decisions. Derivatives traders may need to price in a bigger risk premium for geopolitical events.
Now, with EUR/USD near 1.1250, the story may be changing again. Eurozone industrial production in January 2026 rose 0.5%, beating expectations. Meanwhile, initial US jobless claims have increased for three straight weeks. This may suggest the US growth edge is fading, which could support a rebound in EUR/USD.
VT Markets Brings Global Football Aspirations to Vietnamese Youths
Ho Chi Minh City, Vietnam – 26 February 2026 – VT Markets has successfully completed a community initiative in Vietnam, donating 100 official Newcastle United Football Club (NUFC) footballs to local youth groups in partnership with a youth-focused non-profit organisation named Liên Đoàn Hướng Đạo Nguyễn Trãi.
The initiative reflects the company’s expanding commitment to community development across Asia and forms part of a broader CSR line-up unveiled during its July 2025 event.
Designed to strengthen youth engagement, the donation provides students with quality equipment to support physical education and grassroots football development, helping create a more inspiring and inclusive sporting environment.
In collaboration with Liên Đoàn Hướng Đạo Nguyễn Trãi, footballs were distributed directly to selected communities, ensuring access to students who stand to benefit most from enhanced sporting resources. By supporting grassroots participation, the programme aims to create a more inclusive environment where young people can develop confidence, build friendships, and stay actively engaged in their communities.
“Sport has the power to inspire discipline, teamwork, and resilience – values that extend far beyond the pitch. Through this initiative, we hope to contribute meaningfully to youth development and community growth in Vietnam”, Dandelyn Koh, Head of Global Marketing at VT Markets said.
In recent months, the company has intensified its regional engagement through a series of on-the-ground initiatives, including beach clean-up campaigns and flood relief pack donations aimed at supporting vulnerable communities. With programmes already planned for the new year, VT Markets remains dedicated to deepening its local footprint, reinforcing its role not only as a global financial partner but also as a responsible and proactive community stakeholder.
About VT Markets
VT Markets is a regulated multi-asset broker with a presence in over 160 countries as of today. It has earned numerous international accolades including Best Online Trading and Fastest Growing Broker. In line with its mission to make trading accessible to all, VT Markets offers comprehensive access to over 1,000 financial instruments and clients benefit from a seamless trading experience via its award-winning mobile application.
For more information, please visit the official VT Markets website or email us at [email protected]. Alternatively, follow VT Markets on Facebook, Instagram, or LinkedIn.
For media enquiries and sponsorship opportunities, please email [email protected], or contact:
Dandelyn Koh
Head of Global Marketing
Brenda Wong
Assistant Manager, Global PR & Communications
Bob Savage says USD/SGD, the weakest recent non-carry, has seen easing outflows lately, hinting at a momentum reversal
BNY’s data shows USD/SGD was the weakest “non-carry” currency pair over the past month. It also had a higher monthly average flow magnitude than EUR/USD.
USD/SGD saw steady net selling for almost three straight trading weeks. In the last two sessions, outflows were lighter than earlier in the period.
The data suggests near-term momentum may be shifting. BNY data also shows SGD could face an unwind into month-end after a strong February.
The article says it was produced using an artificial intelligence tool and reviewed by an editor.
The US dollar weakened sharply against the Singapore dollar through most of February, making USD/SGD one of the weakest pairs. But selling pressure in USD/SGD has eased over the last few sessions. That suggests the move that pushed SGD higher may be losing steam.
With a possible reversal forming, we are looking for ways to benefit if USD/SGD rises in early March. One option is to buy short-dated USD/SGD call options. This gives upside exposure if the pair rebounds, while limiting risk to the premium paid.
Recent US inflation data supports this view. Inflation was hotter than expected, running at 3.2% year over year, which could lead the Fed to delay rate cuts. By contrast, the Monetary Authority of Singapore has kept a neutral policy stance, offering little new reason to buy SGD. This policy gap supports a stronger USD/SGD.
We saw a similar setup in Q4 2025. After a long stretch of SGD strength, the move reversed quickly when risk sentiment shifted. The unwind was fast and surprised many. Today’s slowdown in selling pressure feels similar.
Into the end of February, we should watch for a month-end unwind linked to portfolio rebalancing. After a strong run, SGD may be exposed to profit-taking. That could be the trigger for the next move higher in USD/SGD.
Japan’s Statistics Bureau reports Tokyo’s February CPI inflation rose to 1.6% year on year, up from 1.5% previously
Tokyo’s headline CPI rose 1.6% year on year in February, up from 1.5% in January, according to the Statistics Bureau of Japan. Tokyo CPI excluding fresh food rose 1.8% year on year, compared with 1.7% expected and 2.0% previously.
Tokyo CPI excluding fresh food and energy rose 1.8% year on year in February, down from 2.0% in the prior reading. Tokyo CPI is released before the nationwide CPI. It excludes fresh food because those prices can swing with the weather.
Usd Jpy Reaction And Key Levels
After the data, USD/JPY was down 0.20% on the day at 156.13. Key levels to watch were 156.82, 157.66, and 159.23 on the upside. On the downside, levels included 155.35, the 100-day EMA at 154.45, and 152.64. The Bank of Japan targets inflation of about 2%. It introduced Quantitative and Qualitative Easing in 2013, added negative interest rates in 2016, and later controlled the 10-year yield. It then raised rates in March 2024. In 2022 and 2023, the gap between Japan’s policy and other central banks’ policies weakened the yen. That move partly reversed in 2024. Inflation moved above 2% as the yen weakened, global energy prices rose, and wage growth looked more likely. This is a look back at Tokyo CPI data from February 2025, when headline inflation was 1.6%. At the time, it was seen as a small rise, but it continued a slow upward trend. The picture is different now: nationwide inflation in January 2026 came in stronger at 2.4%, beating market expectations.BoJ Outlook And Yen Volatility
Firm inflation through 2025 led the Bank of Japan to raise rates again to 0.25% late last year. This has changed expectations for policy ahead. Markets are no longer only looking for signs that inflation is rising. They are actively pricing in when the next BoJ rate hike could happen. A year ago, USD/JPY was trading above 156. Since then, the smaller interest-rate gap has pushed the pair down to about 148.50 today. This increases the chance of further yen strength and makes long USD/JPY positions riskier. Traders are also using options more, including buying USD/JPY puts to protect against a sudden drop. In the coming weeks, attention will be on early results from the “shunto” spring wage talks. Early reports suggest wage growth could exceed 4.5%, the strongest in decades. That would add pressure on the BoJ to act again soon. As a result, implied volatility in yen pairs is rising, which suggests traders should be ready for bigger price swings. Create your live VT Markets account and start trading now.Tokyo CPI excluding fresh food rose 1.8% year on year in February, beating the 1.7% forecast
Tokyo’s CPI excluding fresh food rose 1.8% year on year in February. This was higher than the 1.7% forecast.
That is a 0.1 percentage point upside surprise. The figures are for Japan’s Tokyo core inflation measure for February.
Implications For Bank Of Japan Policy
This morning’s Tokyo CPI print is an important signal. At 1.8%, it beat expectations and brings the Bank of Japan’s 2% inflation target closer. This raises the chance of a policy rate hike at the next BoJ meeting in March. In FX markets, higher rate-hike odds usually support the yen. We should expect more yen strength if this view gains traction. That points to positioning for a lower USD/JPY, such as buying puts or using bearish option spreads. This is the most important inflation update since the BoJ’s gradual normalization began in 2025. In rates, this inflation reading is likely to push Japanese Government Bond (JGB) yields higher. There may be an opportunity to short JGB futures as markets price a more hawkish central bank. As of January 2026, national core CPI was near 1.6%, so this Tokyo number suggests unwanted acceleration for the BoJ.Equity Market Positioning And Hedging
For equities, a stronger yen often hurts Japan’s export-heavy Nikkei 225. It may be sensible to hedge long equity exposure by buying Nikkei puts. This is a cautious step, especially after the strong performance seen last year. Create your live VT Markets account and start trading now.Tokyo’s annual CPI in Japan, excluding food and energy, eased to 1.8% from 2% previously
Tokyo’s CPI, excluding food and energy, rose 1.8% year over year in February. This compares with 2.0% in the prior reading.
This morning’s Tokyo core-core CPI is a clear dovish signal. It came in at 1.8%, slipping below the Bank of Japan’s 2% target for the first time in more than a year. The drop from January’s 2.0% reading also lowers market expectations for a near-term rate hike. We now need to ask whether there will be any follow-up to the 2025 rate lift-off this spring.
Implications For Bank Of Japan Policy
Last year, the Bank of Japan finally ended its negative interest rate policy, a move markets had expected for months. That shift supported a slow path toward policy normalization, with many of us expecting another hike by Q2 2026. This new inflation data, however, challenges that view. For currency traders, this should make short yen trades more attractive. The rate gap with the U.S. is likely to stay wide, which can keep pressure on the yen. We should consider USD/JPY call options, as a move from around 156 toward 160 now looks more likely. This backdrop is also supportive for Japanese equities, since a weaker yen can lift profits for large exporters. The Nikkei 225, already trading near record highs around 42,000, could get an added boost from this news. We see value in buying Nikkei futures or call spreads to capture possible further gains. In bonds, the lower chance of a rate hike should pull government bond yields down. That makes a long position in 10-year JGB futures appealing in the coming weeks. The 10-year JGB yield, which had been edging toward 1.0%, could now fall back toward 0.85%.Key Catalyst To Watch Next
The next key catalyst will be the results of the “shunto” spring wage talks. Even though recent wage growth was a solid 2.6% year over year, cooler inflation gives the Bank of Japan more room to wait for clearer proof of a wage-price spiral. With last quarter’s GDP showing the economy narrowly avoided recession, the case for immediate tightening has weakened a lot. Create your live VT Markets account and start trading now.Tokyo’s year-on-year consumer price inflation rose to 1.6% in Japan, slightly above the previous 1.5% reading.
Japan’s Tokyo Consumer Price Index (CPI) rose 1.6% year on year in February.
This compares with 1.5%.
Bank Of Japan Policy Outlook
Tokyo CPI for February 2026 came in at 1.6%, slightly above our 1.5% forecast. Even a small upside surprise adds to pressure on the Bank of Japan. It also suggests inflation may be more persistent than expected. We think this raises the chance the BoJ hikes rates at its April meeting, earlier than the market’s current expectation for summer. For FX traders, this supports a stronger yen in the weeks ahead. A potential trade is to buy USD/JPY puts, targeting a move below 145. In 2025, when the BoJ last signaled a more hawkish stance, the yen gained nearly 2% over the following week. That pattern could repeat. In rates, this points to a steeper yield curve as investors price in a more aggressive central bank. A direct way to express this view is to short 10-year Japanese Government Bond (JGB) futures. Recent Japan Securities Dealers Association data shows foreign investors have been net sellers of JGBs for three straight weeks, which supports this trade. For Japanese equities, this inflation report is a headwind. Higher borrowing costs and a stronger yen can pressure corporate profits. One way to hedge, or to position for a short-term pullback, is to buy put options on the Nikkei 225. In 2025, the index fell about 4% in the month leading up to the BoJ’s last rate change. Uncertainty around the BoJ’s next move may also lift volatility. The Nikkei Volatility Index is near a six-month low of 16, which looks low given current risks. Buying straddles on major Japanese ETFs could be a way to benefit from larger price swings, regardless of direction.Volatility And Hedging Strategy
Create your live VT Markets account and start trading now.Gold rises toward $5,195 amid tariff uncertainty and safe-haven demand, as traders await US PPI data
Gold traded near $5,195 in early Asian trading on Friday. It inched closer to $5,200 as demand rose on uncertainty about US tariffs. Markets are also waiting for the US January Producer Price Index (PPI) later on Friday.
Donald Trump said he would impose a flat 15% tariff on imports after a Supreme Court ruling ended his earlier reciprocal tariff plan. US Trade Representative Jamieson Greer said tariffs could rise to 15% or more for many countries in the coming days.
