Summary
By almost every comparison the dollar should be rolling up its European competitor. American economic growth is far stronger and accelerating; the Federal Reserve has begun a tightening cycle while the European Central Bank is looking for novel ways to loosen its monetary policy and the spread between 2-year Treasuries and their Bund equivalents has more than doubled since mid-December. Yet the euro has been trading in the same 1.3400-13800 range since mid-September. Why? We will look at some of the reasons why the currency markets can become disconnected from fundamentals and offer some speculation on when the links might be reasserted.Latest Live Videos
Editors’ Picks
WTI retraces sharply to $70, eyes on Strait of Hormuz oil flows
West Texas Intermediate, the US crude oil benchmark, is retracing its spike to above $73 in the Asian session on Friday. WTI jumped to its highest since June 2025 after joint military strikes by the US and Israel against Iran over the weekend. Traders now assess the oil supply flow through the Strait of Hormuz for further cues.
Gold looks further north as Iran war boosts haven demand
Gold is taking a breather after the initial run to over one-month highs near $5,400, kicking off the new week with a bang. A global flight to safety theme, following the US-Israel joint attacks on Iran over the weekend, bolstered the demand for the traditional store of value, Gold.
AUD/USD fills weekly bearish gap against retreating USD; retakes 0.7100
The AUD/USD pair rebounds following the weekly bearish gap opening to the 0.7030 area, or the lower end of a three-week-old range, and climbs back above the 0.7100 mark during the Asian session.
Bitcoin, Ethereum and Ripple under pressure as key supports face breakdown risk
Bitcoin, Ethereum, and Ripple prices trade on the back foot at the start of this week on Monday, after extending losses in the previous week. BTC is on the brink of a breakdown, ETH is capped below key resistance, and XRP risks a crack of the trendline.
The market is paying for insurance, not apocalypse
As expected, this morning felt less like a Monday market open and more like a fire drill. Futures screens flickered red. S&P contracts down almost 1%. Nasdaq off 1.2%. Brent leaped 13% through $80. Gold rose 1.6% toward $5350 before paring some gains. The dollar is strutting mildly. The Swiss franc is quietly doing what it always does in a storm, catching some safe-haven flows.
February employment preview: Back to payroll reality
We expect the February employment report to show that January’s robust pace of job growth overstated underlying momentum in the labor market. We look for nonfarm payrolls to rise 45K in February, moderating from its current three-month average pace of 73K (Figure 1).