Today's Currencies Pulse
Rupee flat on hopes West Asia truce will hold
The Indian rupee held steady as markets priced in hopes that a West Asia truce would hold, hovering near ₹95.78 per dollar after slipping 8 paise in early trade. Traders kept a close eye on geopolitical developments while the currency remained largely unchanged.
What’s Next for China’s Yuan Payment System? Adviser Banks on Close Trade Partners
Former ICBC chairman Chen Siqing urged China to embed its Cross‑border Interbank Payment System (CIPS) into bilateral trade frameworks, especially with Belt‑Road and RCEP partners, as geopolitical tensions heighten reliance on non‑US payment networks. He highlighted CIPS’s rapid growth, processing 175 trillion yuan in 2024—up 40% year‑on‑year—and now serving over 1,700 institutions across 190 jurisdictions. Chen also called for coordinated development of the digital yuan and blockchain‑based settlement to boost CIPS’s technical standards. The push aligns with Beijing’s five‑year plan to create an autonomous yuan payment backbone.
What Will the Fed’s “Warsh Era” Bring?
Kevin Warsh’s nomination to replace Jerome Powell places a deeply divided Federal Reserve at a crossroads. Warsh argues the institution needs a revamped analytical framework and a “balance‑sheet theory” rather than a singular focus on rate cuts. He suggests structural...
Italian Regulator Blocks Access to Websites of Keyline FX, Solaxy Tech and Po Trade
Italy’s financial regulator CONSOB ordered the blocking of ten websites that were providing unauthorized investment services, including foreign‑exchange and cryptocurrency offerings. The sites targeted include Keyline FX, Solaxy Tech, Po Trade and related advertising domains, and CONSOB also asked Google to remove the...
Eurozone February Final Consumer Confidence -12.2 vs -12.2 Prelim
Eurozone consumer confidence held steady at a final -12.2 in February, matching the preliminary reading. Economic confidence slipped to 98.3, missing forecasts, while industrial confidence fell to -7.1 and services confidence dropped to 5.0, both below expectations. Employment expectations declined...
ECB President Lagarde: My Baseline Is that I Will Stay Until the End of My Term
ECB President Christine Lagarde told reporters her baseline assumption is that she will remain in office until the end of her six‑year term. Analysts note her wording leaves room for an earlier exit, a scenario that has been floated in...
Northern Trust Adds Berenberg to Its Framework of Dynamic Currency Hedging Solutions
Northern Trust announced the addition of Berenberg’s AI‑driven foreign‑exchange models to its dynamic currency‑hedging framework. The partnership lets institutional clients embed third‑party, model‑based strategies and adjust hedge ratios in real time across the US, UK, Europe, Australia and Canada. By...
Christine Lagarde: Hearing of the Committee on Economic and Monetary Affairs of the European Parliament
Christine Lagarde told the European Parliament that euro‑area inflation has fallen sharply, reaching 1.7% in January and hovering near the ECB’s 2% target. Despite the data, surveys show households still perceive price growth about 1.2 percentage points higher than official...
Great Liquidity Partnerships Are Built on Trust
Alex Mackinnon, CEO of Finalto Asia, argues that regulation has become a catalyst rather than a constraint, enabling the liquidity market to mature and gain trust. He highlights Finalto’s multi‑asset prime brokerage model, which spans equities, commodities, crypto, FX and...
China’s Role: Minor Export Market, Major Input Supplier, CNY Undervalued
It means a lot less than this. As an export market China is way less important than the US to Germany/ the EA. As a source of consumer & intermediate inputs China is of course a massive supplier,...
Dollar Remains Dominant; No Viable Reserve Alternatives Yet
My @BrookingsInst blog on whether US reserve currency status is eroding. There’s no sign the fall in the Dollar is accompanied by foreign reserve managers bailing on the greenback. There simply aren’t any viable alternatives, including the Euro… https://t.co/U189pIWHJ4
NZD/USD Holds Gains Around 0.6000 as US Dollar Falters on Tariff Concerns
The New Zealand dollar extended its rally for a third straight session, hovering around the 0.6000 level against the US dollar during Asian trading. The move reflects pressure on the US dollar as President Trump defended tariffs and the IMF warned...
Brazil's Trade Surplus Ignored, Real Remains Undervalued
No other EM has transformed itself in the past decade quite like Brazil, which has shifted its trade balance into a structural surplus. This shift has gotten no recognition in markets whatsoever. The Real remains deeply discounted compared to pre-COVID... https://t.co/1DJ37H8dXi...
Dollar Hits Post‑Election Low, Signals Ongoing Debasement
The Dollar yesterday made a new post-election low against EM (black line). Except for the tariff turmoil in Apr. '25, USD has been falling in a straight line against EM currencies. This is the best leading indicator for Dollar direction....
US Dollar Index Falls to Near 97.50 as White House Policy Doubts Linger
The U.S. Dollar Index slipped to around 97.50 during Asian trading, marking a second straight session of decline amid White House policy doubts. President Donald Trump’s State of the Union remarks defended and expanded Section 122 tariffs to 10 %, adding trade‑related...
Turkey's January Trade Deficit Hits Near‑worst, Lira Tumbles
Turkey's trade deficit for January - out today - shows further deterioration. Chart below shows the trade deficit every January from 2000 - 2026. The 2026 number is the worst deficit except for 3 prior years (2018, 2022, 2023). This...
Brazil Real Rebounds to 4.50 as Dollar Weakens
After Russia's invasion of Ukraine in 2022, Brazil's Real went from $/BRL 6.00 to 4.50 in a few months as rising commodity prices lifted the terms of trade. Now the Real is gaining along with most other EMs as Dollar...
Developments in Foreign Exchange and Over-the-Counter Derivatives Markets
The BIS Triennial Survey shows global foreign‑exchange turnover jumped to US$9.5 trillion per day in April 2025, a 27 % rise driven by heightened volatility, hedging and speculative activity. Spot and outright forwards led the surge, while currency‑option turnover more than doubled and...
Yen Rebounds While RMB Gains Accelerate in FX Consolidation
Within the continued consolidation of the FX market, there are two standouts: 1) After being the only G10 currency that fell yesterday, the yen is the only one higher today. 2) the RMB's gains have accelerated. https://t.co/AiTduO3fl9 https://t.co/BxiHf6en8T
BoE's Stablecoin Cap Triggers Industry Backlash
The Bank of England’s plan to cap stablecoin holdings is sparking an industry revolt BTW. £5,000 and £20,000 for individuals BTW. £1 million to £10 million for businesses. https://t.co/taO9by7gd2
Meta’s Digital Dollar Comeback Could Unlock a $1 Trillion Treasury Shift Washington Is Not Ready For
Meta is planning to introduce stablecoin‑based payments in the second half of 2026 by partnering with a third‑party provider, avoiding the need to issue its own token. The initiative leverages the 2025 GENIUS Act’s regulatory framework, positioning digital dollars as...
Nuanced Take: BoP Deficit Matters,
I actually don't think Mark and I are that far apart (tho I wouldn't start by arguing that a BoP deficit is meaningless, as I certainly find value in some cuts of the balance of payments + get annoyed when...
Stop Bad Timing: Fix Missed Opportunities
Ever take a perfect setup just to watch it go nowhere? Then it moves right after you exit? That's not bad luck - it's bad timing. Learn how to fix that https://t.co/fjBDMYb0AE https://t.co/8b9qHMu9bF
ECB Adopts Opinion on Appointment of Its Future Vice-President
The European Central Bank’s Governing Council issued an opinion supporting the EU Council’s proposed candidate, Boris Vujčić, for the next Vice‑President. Vujčić, currently Governor of the Croatian National Bank, will assume the role on 1 June 2026 for a non‑renewable eight‑year term,...
Decoding Congress's 1975 Balance‑of‑Payments Language
This is a thread that only Adam Tooze, a few international economist and a couple of very well paid trade lawyers are likely to enjoy … The basic question is what did Congress mean back in 1975 when they wrote about...
Current Stance:
My positioning & stance update on Gold , Dollar , US indexes & Bitcoin 🧵
Payoneer Applies for Bank Charter
Payoneer has filed an application with the Office of the Comptroller of the Currency for a U.S. national trust bank charter, to be branded as PAYO Digital Bank. The charter would let the firm issue, send and receive stablecoins, provide...
Timing Matters: Five Distinct NY Trading Sessions
The market doesn't trade the same all day. The NY trading day has 5 distinct sessions: → Early NY Open → NY Open → NY Close → Asia Open → London Open Some are continuation trades. Some reversals. Do you agree that market...
Thailand Interest Rate Cut
The Bank of Thailand cut its benchmark rate to 1.0 % on February 25, 2026, a 25‑basis‑point reduction from 1.25 % and the lowest level since October 2022. The move was unexpected, coming after a similar cut in December and reflecting a revised outlook...
US Treasury Borrowing No Longer Cheap Despite 4% Yield
There's lots of buzz about 10-year Treasury yield falling to 4%. But when you look at this yield vs US peers - hedging those yields back into US Dollars - the US picture isn't nearly so sanguine. The days when...
Germany Urges China to Let RMB Appreciate, Reversing Stance
Germany joining the chorus call for China to allow the RMB to rise -- a big change from 15 years ago, when Germany didn't think China's currency management was its problem https://t.co/1J5Z0lrxma
Commerzbank Warned ECB Officials Intervention Is Necessary to Cultivate Euro-Stablecoins
Commerzbank has cautioned that the European Central Bank must step in to nurture a viable euro‑stablecoin ecosystem. The bank argues that without clear regulatory guidance, market participants will remain hesitant, slowing adoption of digital euros. It also stresses the need...
EM Currencies Surge, Yet Turkish Lira Slides Amid High Carry
Most EM currencies are managing to rally strongly against the Dollar so far in 2026. Turkish Lira is falling and the worst performer. This despite annual carry of over 30%. The fact that Lira is still falling is a sign...
Rial Depreciates as US Threats Loom Over Iran
FYI: as we wait to see if the Trump Administration will move forward with direct attacks on Iran, this is US Dollar - Iranian Rial exchange rate. The reversion to a float since the beginning of the year does not...
Bank of Japan Won’t Alter Its Policy Normalisation Path
The Bank of Japan affirmed its commitment to a gradual policy normalisation path, emphasizing data‑driven decisions despite the appointment of two dovish board nominees. While the new members are expected to voice opposition to tightening, the overall board composition remains...
Bostic Warns Fed Independence Faces Real, Uncertain Threat
Outgoing Atlanta Fed President Raphael Bostic signals greater concern about the institution's independence than the more anodyne statements typically offered by his colleagues when the subject comes up He says there's an ongoing threat and the outcome is genuinely uncertain https://t.co/ntwkE73UgE
Dollar Slides vs EM, Brazil's Real Hits Two-Year High
The Dollar is tumbling. Not against the G10, where it's basically stable, but against EM, where it's making new lows almost every day. One of the main beneficiaries of all this is the Brazilian Real, which is the strongest versus...
Iranian Rial Plummets, Ranks Third Worst Globally
On this week's Hanke's #CurrencyWatchlist, the Iranian rial ranks as the WORLD'S 3RD WORST CURRENCY. The rial has depreciated by 43% against the USD over the past year. RIAL = IN REAL BIG TROUBLE. https://t.co/FmVN6Cuf8I
South Sudan Lacks Reliable Money Data, Undermining Accountability
South Sudan’s government hasn’t produced RELIABLE MONEY SUPPLY DATA since October 2024. SOUTH SUDAN = NO RELIABLE DATA = NO ACCOUNTABILITY. https://t.co/UAqAIjbHdP
USDJPY‑Yield Spread Correlation Rebounds to Strong Positive
The rolling 40-day (2 month) correlation between $USDJPY and the US-Japan 2-year yield spread has rebound to a stronger positive (+0.6) after 10 months of inversion. Will it just start syncing up or will this gap in carry standing close?...
Factor National Interests, Avoid Becoming Market Victim
You can begin factoring national interests and power factors into your preferred free market analysis or you can be a victim of it. https://t.co/bDXsO4Jd8A
Fed Moves Needn't Dictate Other Central Banks' Actions
The policies of the Fed impact economies globally, but that doesn’t mean other central banks have to follow the Fed. If the Fed were to implement surprise rate cuts, the Bank of England should arguably do the exact opposite. My latest...
North Korean Won Plummets, Becomes World’s Second Worst Currency
On this week's Hanke's #CurrencyWatchlist, the North Korean won ranks as the WORLD'S 2ND WORST CURRENCY. The won has depreciated by over 50% against the USD in the past year. KIM JONG UN'S ANTICS = CURRENCY CATASTROPHE. https://t.co/mODtL8ocdu
Yen Rebounds, Forint Climbs, Yuan Rallies Onward
JPY reversing weaker HUF gaining (on negative polls for Orban) CNH continues to rally consistently
Yen Rebounds; Intervention Futile Amid Debt Overhang
The Yen is heading back to where it was before the "rate check" from the NY Fed. Intervention doesn't work, especially when the underlying issue is a massive debt overhang and politicians who prefer denial to taking hard, but needed...
Japanese Stocks Hit Record Highs Amid Yen, JGB Selloff
Yen and JGBs Sold on New BOJ Nominees While Japanese Stocks Rally to Record Highs: The dollar was initially sold during President Trump’s State of the Union Address. However, against most of the G10 currencies, it remains within the well-worn...
Turkey's Reserve Losses Signal Strong Depreciation Pressure
Turkey had sustained reserve losses towards the end of last year (blue), even though Lira was falling and USD was weak. That's a sign that depreciation pressure is substantial, a reflection of the large current account deficit. Same old story...
Dovish BOJ Picks Trigger Yen Selloff, Stock Surge
The main development today is the reaction to the two dovish nominations to the BOJ board. The yen and JGBs have been sold, while Japanese stocks raced to record highs. Note there are many large option FX...
Japan PM Takaichi Mocks US over Dovish Central Bank Picks
"Mine is bigger than yours" "Mine is better than yours" "My Central Bank appointee is more dovish than yours" says Japan PM #Takaichi to #Trump after she picked 2 #reflationist candidates #forex $USDJPY #USDJPY
Lagarde Likely to Exit Early, Knot Poised as Successor
Christine Lagarde is expected to leave the ECB before her term ends, paving the way for Klaas Knot to succeed her as president, according to a Bloomberg survey of economists https://t.co/rjUbI1zZMG via @jrandow https://t.co/aOgFWMclPG
BofA Records Highest Euro Allocation, Cuts US Exposure
Bank of America show the biggest positive allocation to #euro assets on record in an impressive global rebalancing. A net 22% say they hold a lower-than-benchmark allocation to US, from just 6% at end of 2025. The backlash appears to...