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The Australian Dollar begins Thursday’s session with minuscule gains of 0.04%, after posting losses of 0.68% on Wednesday, courtesy of broad US Dollar strength, despite improved risk appetite. At the time of writing, the AUD/USD trades at 0.6950.Aussie pares losses after softer Australian inflation, but broad US Dollar strength keeps upside limitedGeopolitics are driving the financial markets’ narrative, as each new headline keeps investors uneasy amid information about the US-Iran war, shifting the markets’ mood. Growing speculation about the start of US-Iran talks to end the war in the Middle East pushed US equities, the US Dollar and Gold prices…

Nordea’s Group Chief Economist Helge J. Pedersen notes that the Danish parliamentary election has produced a highly fragmented Folketing, with 12 parties entering parliament and no majority for either the red or blue bloc. The Moderates, led by Lars Løkke Rasmussen, now hold the balance of power. Pedersen highlights that complex negotiations could delay forming a new Danish government, while a caretaker administration handles only necessary, non-political decisions.Fragmented parliament complicates coalition building”The Danish parliamentary election ended with a fragmented parliament, where all 12 parties that ran in the election now get seats.””Everything therefore points to the Moderates’ Lars Løkke Rasmussen…

EUR/GBP trades around 0.8650 on Wednesday, slightly lower on the day, as investors weigh rising inflation risks in the Eurozone against mixed macroeconomic signals from the United Kingdom (UK) and Germany.In the Eurozone, comments from European Central Bank (ECB) officials dominate the narrative. Chief Economist Philip Lane warns that inflation readings could come in higher in March and April, pointing to a potential jump in the overall price level amid surging energy costs linked to the Middle East war. He also emphasizes the importance of monitoring price expectations and forward-looking indicators such as wages.ECB President Christine Lagarde echoes this cautious…

The rupee slumped 29 paise to close at record low of 94.05 (provisional) against the US dollar on Wednesday as heavy FII outflows and simmering tensions in West Asia kept investors on the edge.Even a drop in global crude oil prices, weaker greenback, and positive sentiments in the domestic equity markets could not provide any respite to the local unit, forex traders said.At the interbank foreign exchange, the local unit opened at 93.94 against the US dollar and traded in the range of 93.86-94.08, before settling at an all-time low of 94.05 (provisional), down 29 paise from its previous close.The…

The Indian rupee weakened slightly on Wednesday but held off pressure from dollar demand linked to maturing non-deliverable forwards and foreign portfolio outflows, as the central bank intervened to support the currency.The rupee hovered near its record low of 93.98 per dollar through the ‌session before ⁠closing at ⁠93.9775, down 0.1%.Indian stocks rose after Brent crude fell below $100 a barrel, but ​the rupee struggled to benefit as interbank traders and importers bought dollars.A series of NDF maturities, including Wednesday’s, is expected to keep the rupee under pressure over the next week, a trader at a private bank said.Indian stocks…

Deutsche Bank’s Chief UK Economist Sanjay Raja notes that UK inflation data broadly matched expectations, with Headline CPI at 3% and stronger Services CPI driving a firmer Core CPI outcome. He warns that rising fuel, energy and input costs are likely to push CPI back towards 3.5% year-on-year, undermining prospects for Bank of England rate cuts in 2024 and even raising the risk of renewed hikes.Rising energy costs threaten disinflation path”UK inflation came broadly as expected. Headline CPI printed at 3%, with core CPI coming in a touch stronger than consensus expectations (though in line with our own projection). Why…

The Indian central bank likely intervened to support the rupee on Wednesday as heavy dollar demand linked to maturing non-deliverable forwards (NDFs) that it had relied on to manage volatility in the currency, blunting relief from a pullback in oil prices. The likely intervention via state-run banks, ‌traders said, helped ⁠the South ⁠Asian currency hold above its record low of 93.98 per dollar to last quote at 93.96, down 0.1% on the day. “To prevent a more rapid slide in the rupee, the RBI continues to intervene in the FX market through both spot and forwards. As the NDFs mature,…

The UK Office for National Statistics (ONS) will release the February Consumer Price Index (CPI) figures on Wednesday at 07:00 GMT, a print that will matter for markets. Consensus expectations point to inflation pressures keeping their grasp on the economy.UK consumer inflation remains one of the most important inputs for the Bank of England (BoE) and typically carries real weight for the British Pound (GBP). Following the latest hawkish hold by the BoE on March 19, investors now anticipated the ‘Old Lady’ to hike its policy rate at its April 30 gathering.What to expect from the next UK inflation report?Headline…

The Australian Bureau of Statistics (ABS) will release the Consumer Price Index (CPI) for February on Wednesday at 00:30 GMT, with inflation expected to hold steady at 3.8% YoY and come in flat on a monthly basis. This release comes as the Reserve Bank of Australia (RBA) has already raised its key rate to 4.10%, highlighting concerns over persistent inflation. Policymakers remain focused on potential second-round effects, while markets increasingly anticipate another rate hike in the coming months.Meanwhile, geopolitical developments are playing a growing role in inflation expectations. Escalating tensions in the Middle East and disruptions to energy supply routes…

USD/JPY trades around 158.70 on Tuesday at the time of writing, up 0.16% on the day, supported by a US Dollar (USD) that maintains a bullish bias amid ongoing geopolitical and economic uncertainty.The US Dollar Index (DXY), which measures the Greenback against a basket of six major currencies, is holding near 99.30 after easing from 99.50, reflecting sustained demand for the US currency. Escalating tensions in the Middle East continue to drive safe-haven flows while fueling concerns about a broader global economic slowdown.In the United States (US), the latest preliminary S&P Global Purchasing Managers Index (PMI) data highlight a loss…