Stocks Rally on Ceasefire Hopes – Nasdaq up 1.5%

Global stock markets rallied in the latter half of the trading day yesterday as news hit the wires that Iran is looking for a ceasefire with Israel. The three major US indices all pushed higher, the Dow up 0.75%, the S&P 0.94%, and the tech-heavy Nasdaq jumped 1.54%. The dollar pulled back, the DXY down 0.14% to 98.13, while sterling pushed higher on news that a trade deal between the US and the UK has been finalized. US Treasury yields gained more ground, the 2-year up 1.9 basis points to 3.967%, and the 10-year up 4.8 basis points to 4.446%. Oil prices took a hit, now sitting over 7% off Friday’s peaks, with Brent down 1.67% on the day to $72.99 and WTI down 1.66% to $71.77 a barrel. Gold also pulled back off recent highs as haven flows receded, down 1.42% to $3,381.69.

Oil Remains in Focus for Investors This Week

Oil prices have been rocked by updates out of the Middle East in the last few trading days, and investors are expecting more volatility in the days ahead. WTI gained as much as 12.66% on Friday as news hit the market of attacks by Israel on Iranian nuclear facilities and subsequent reprisals from Iran and has since dropped back to starting levels on news that Iran is now seeking a ceasefire. Most investors now are awaiting clarity on the situation before looking to position themselves for longer-term plays; however, fast-money accounts will still look to trade what is now a large range on the back of any fresh updates. Initial support for WTI now comes in on the 200-day moving average just above $68.50, with longer-term support on the trendline down at $57.70, while resistance sits up on Friday’s high at $77.62. Any further escalation in the situation will see those recent highs come into focus swiftly, whilst a move towards a ceasefire should see prices move back towards levels seen before Friday’s attacks.

Fundamental Calendar Picks Up Today

Traders are expecting fundamentals to start picking up their influence on markets from today as the week progresses, as the Bank of Japan becomes the first cab off the rank in a busy central bank week. The rate decision from the BOJ will be the major focus for Asian markets today, with the announcement expected to come around lunchtime in Tokyo. The bank is firmly expected to keep rates on hold at 0.5%, but traders are expecting volatility around the statement and the press conference later in the day. There is little on the calendar in the European time zone today, and updates out of the Middle East are expected to remain in focus for traders. The New York open sees the first major update from the US this week with Retail Sales data (exp -0.5% m/m) and Core Retail Sales data (exp +0.2% m/m) due out. Once again though, most market participants are expecting updates from the Middle East and the G7 meetings in Canada to dominate market sentiment.

The post General Market Analysis – 17/06/25 first appeared on IC Markets | Official Blog.

DXY (US Dollar Index):

Potential Direction: Bullish

Overall momentum of the chart: Bearish

The price has just bounced off the pivot and could potentially make a bullish move in the short term, and rise toward the 1st resistance.

Pivot: 97.71

Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 96.97

Supporting reasons: Identified as a support that aligns with the 161.8% Fibonacci extension, indicating a potential area where the price could stabilize once again.

1st resistance: 98.76
Supporting reasons: Identified as a pullback resistance that aligns with the 61.8% Fibonacci retracement, indicating a potential level that could cap further upward movement.

EUR/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price is falling toward the pivot and could potentially make a bullish bounce off this level, rising toward the 1st resistance. Additionally, the price is above the Ichimoku Cloud, which adds further significance to the strength of the bullish momentum.

Pivot: 1.1451

Supporting reasons: Identified as a pullback support that aligns closely with the 50% Fibonacci retracement, indicating a potential area where buying interest could pick up to resume the uptrend.

 1st support: 1.1342
Supporting reasons: Identified as an overlap support, indicating a potential area where the price could again stabilize.

1st resistance: 1.1617

Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

EUR/JPY:

Potential Direction: Bearish

Overall momentum of the chart: Bullish

Price could potentially make a bearish reversal off the pivot, and move toward the 1st support.

Pivot: 167.42

Supporting reasons: Identified as a pullback resistance that aligns closely with the 61.8% Fibonacci projection and the 161.8% Fibonacci extension, providing a significant level for a potential bearish reversal.

1st support: 165.17
Supporting reasons: Identified as an overlap support, indicating a potential area where the price could again stabilize.

1st resistance: 169.96
Supporting reasons: Identified as a pullback resistance and acting as a key area that could halt any further upward movement.

EUR/GBP: 

Potential Direction: Bearish
Overall momentum of the chart: Bullish

Price could potentially make a bearish reversal off the pivot, and move toward the 1st support.

Pivot: 0.8524

Supporting reasons: Identified as a pullback resistance that aligns closely with the 50% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 0.8450
Supporting reasons: Identified as a pullback support that aligns closely with the 61.8% Fibonacci retracement, indicating a potential area where the price could stabilize once more.

1st resistance: 0.8612
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.

GBP/USD:

Potential Direction: Bullish

Overall momentum of the chart: Bullish

Price is falling toward the pivot and could potentially make a bullish bounce off this level, rising toward the 1st resistance.

Pivot: 1.3507

Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 1.3412
Supporting reasons: Identified as an overlap support that aligns closely with the 38.2% Fibonacci retracement, indicating a potential area where the price could stabilize once more.

1st resistance: 1.3618
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.

GBP/JPY:

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 194.05

Supporting reasons: Identified as an overlap support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 191.67

Supporting reasons: Identified as a pullback support, indicating a potential level where the price could stabilize once more.

1st resistance: 197.23
Supporting reasons: Identified as a resistance, that aligns with the 127.2% Fibonacci extension, acting as a key area that could halt any further upward movement

USD/CHF:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

Price is trading close to the pivot and could make a bearish reversal off this level, falling toward the 1st support.

Pivot: 0.8158

Supporting reasons: Identified as a pullback resistance that aligns closely with the 61.8% Fibonacci projection, providing a significant level for a potential bearish reversal.

1st support: 0.8066
Supporting reasons: Identified as a pullback support, indicating a potential level where the price could stabilize once again.

1st resistance: 0.8242
Supporting reasons: Identified as a multi-swing high resistance, indicating a potential level that could cap further upward movement.

USD/JPY:

Potential Direction: Bullish

Overall momentum of the chart: Bearish

Price could potentially make a bullish continuation toward the 1st resistance.

Pivot: 144.34

Supporting reasons: Identified as a pullback support, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 142.98
Supporting reasons: Identified as an overlap support, suggesting a potential area where the price could stabilize once more.

1st resistance: 146.15
Supporting reasons: Identified as a swing high resistance that aligns with the 127.2% Fibonacci extension, indicating a potential level that could cap further upward movement.

USD/CAD:

Potential Direction: Bearish

Overall momentum of the chart: Bearish

The price is rising toward the pivot and could potentially make a bearish reversal off this level to fall toward the 1st support. The presence of the red Ichimoku Cloud adds further significance to the strength of the downward momentum.

Pivot: 1.3601

Supporting reasons: Identified as an overlap resistance that aligns closely with a 38.2% Fibonacci retracement, indicating a potential area where selling pressures could intensify.

1st support: 1.3539
Supporting reasons: Identified as a swing-low support, indicating a key level where the price could stabilize once more.

1st resistance: 1.3655

Supporting reasons: Identified as an overlap resistance that aligns with a 61.8% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

AUD/USD:

Potential Direction: Bullish

Overall momentum of the chart: Neutral

The price has made a bullish bounce off the pivot and could rise toward the 1st resistance.

Pivot: 0.6512

Supporting reasons: Identified as a pullback support that aligns closely with a 50% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 0.6466

Supporting reasons: Identified as a multi-swing-low support, suggesting a potential area where the price could stabilize once again.

1st resistance: 0.6545
Supporting reasons: Identified as a multi-swing-high resistance that aligns closely with a 127.2% Fibonacci extension, indicating a potential area that could halt any further upward movement.

NZD/USD

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 0.6036
Supporting reasons: Identified as a pullback support that aligns closely with a 50% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 0.5989

Supporting reasons: Identified as an overlap support, suggesting a potential area where the price could stabilize once more.

1st resistance: 0.6080

Supporting reasons: Identified as a multi-swing-high resistance that aligns closely with a 127.2% Fibonacci extension, indicating a potential area that could halt any further upward movement.

US30 (DJIA):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling toward the pivot and could potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 41,941.00

Supporting reasons: Identified as a multi-swing-low support that aligns with a 61.8% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 41,458.80

Supporting reasons: Identified as a swing-low support that aligns closely with a 78.6% Fibonacci retracement, suggesting a potential area where the price could stabilize once again.

1st resistance: 42,621.33

Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

DE40 (DAX):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling toward the pivot and could potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 23,027.10
Supporting reasons: Identified as a multi-swing-low support that aligns closely with a 61.8% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 22,564.80

Supporting reasons: Identified as a pullback support that aligns closely with a 78.6% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 23,666.10
Supporting reasons: Identified as an overlap resistance, indicating a potential area that could halt any further upward movement.

US500 (S&P 500): 

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price could fall toward the pivot and potentially make a bullish bounce off this level to rise toward the 1st resistance. The presence of the green Ichimoku Cloud adds further significance to the strength of the upward momentum.

Pivot: 5,938.65

Supporting reasons: Identified as an overlap support that aligns closely with a 50% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 5,867.80

Supporting reasons: Identified as a swing-low support that aligns closely with a 61.8% Fibonacci retracement, indicating a potential level where the price could stabilize once again.

1st resistance: 6,089.75

Supporting reasons: Identified as a swing-high resistance, indicating a potential area that could halt any further upward movement.

BTC/USD (Bitcoin):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling toward the pivot and could potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 104,463.04

Supporting reasons: Identified as a multi-swing-low support that aligns closely with a 61.8% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 102,716.38
Supporting reasons: Identified as a swing-low support that aligns with a 78.6% Fibonacci projection, indicating a potential level where the price could stabilize once more.

1st resistance: 108,761.68
Supporting reasons: Identified as a swing-high resistance that aligns closely with a 78.6% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

ETH/USD (Ethereum):

Potential Direction: Bullish

Overall momentum of the chart: Neutral

Price is falling toward the pivot and could potentially make a bullish bounce off this level to rise toward the 1st resistance.

Pivot: 2,486.22
Supporting reasons: Identified as a multi-swing-low support that aligns with a 78.6% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 2,383.18
Supporting reasons: Identified as a swing-low support, indicating a potential level where the price could stabilize once again.

1st resistance: 2,650.86
Supporting reasons: Identified as an overlap resistance that aligns with a 50% Fibonacci retracement, indicating a potential area that could halt any further upward movement.

WTI/USD (Oil):

Potential Direction: Bullish

Overall momentum of the chart: Bullish

The price has made a bullish bounce off the pivot and could rise toward the 1st resistance. The presence of the green Ichimoku Cloud adds further significance to the strength of the upward momentum.

Pivot: 70.19

Supporting reasons: Identified as a multi-swing-low support that aligns closely with a 23.6% Fibonacci retracement, indicating a potential area where buying interests could pick up to resume the uptrend.

1st support: 67.86
Supporting reasons: Identified as a pullback support that aligns closely with a 38.2% Fibonacci retracement, indicating a key level where the price could stabilize once more.

1st resistance: 74.95
Supporting reasons: Identified as a multi-swing-high resistance, indicating a potential area that could halt any further upward movement.

XAU/USD (GOLD):

Potential Direction: Bullish
Overall momentum of the chart: Bullish

Price could potentially make a bullish bounce off the pivot, rising toward the 1st resistance. 

Pivot: 3,384.60

Supporting reasons: Identified as a pullback support that aligns closely with the 38.2% Fibonacci retracement, indicating a potential area where buying interests could pick up to stage a rebound.

1st support: 3,325.82
Supporting reasons: Identified as an overlap support, acting as a potential level where price could stabilize once again.

1st resistance: 3,470.98
Supporting reasons: Identified as a resistance that aligns with the 161.8% Fibonacci extension, indicating a potential area that could halt any further upward movement.

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The post Tuesday 17th June 2025: Technical Outlook and Review first appeared on IC Markets | Official Blog.

The thing about the enemy of my enemy being my friend is that the two might find out that they don’t have much else in common besides that. Brussels and Beijing have been trying to be more cordial to each other as of late but with Trump mostly backing down, the sour relations between the two are starting to crop up again.

The latest story here is that the EU has refused to hold a flagship economic meeting with China, also known as the EU-China High-Level Economic and Trade Dialogue, ahead of the EU-China leaders’ summit next month. For some context, the economic meeting is one often regarded as laying the groundwork before any major meet up between higher level officials from both countries.

And this one is meant to set the stage for the leaders’ summit in Beijing next month on 24-25 July.

One of the sources said that “China would like to have it (the economic dialogue), but we are seeing no progress in all of our talks”. Another mentioned that the EU will only participate in the meeting if there were agreements at the summit to implement.

As a reminder, the EU and China are still locking horns on another of trade issues for a while now. Before Trump, the main concern was the EU tariffs on Chinese EVs while China also imposed a host of anti-dumping duties on EU products. And the recent rare earth export restrictions have only added to the above disputes.

The other way to look at this is that this year marks the 50th anniversary of bilateral relations between the two sides. And at the upcoming leaders’ summit next month, Beijing has opted for premier Li Qiang to be its representative instead of president Xi Jinping. So, perhaps Brussels is taking that as a bit of a slap in the face and is deciding to slap back.

This article was written by Justin Low at www.forexlive.com.

IC Markets Asia Fundamental Forecast | 17 June 2025

What happened in the U.S. session?

Manufacturing activity in the state of New York continues to highlight ongoing deterioration as the Empire State Manufacturing Index declined for the fourth successive month, dropping from -9.2 in the prior month to -16 in June. This marked the weakest reading since March’s two-year low of -20. Key indicators showed broad-based weakness as new orders and shipments both declined while supply availability worsened, and delivery times were largely unchanged. The latest report will no doubt place continued overhead pressures on the dollar index (DXY).

What does it mean for the Asia Session?

The Bank of Japan (BoJ) will be holding its monetary policy announcement on Tuesday and as per customary practice, the exact time of the press release is unconfirmed, but we should expect it to drop anywhere between 2 and 4 am GMT. After maintaining its key policy rate at 0.5% in May, the BoJ is expected to keep rates steady once more, taking a cautious stance as it focuses on assessing the impact of rising global economic risks on Japan’s fragile recovery. With ongoing uncertainties in the domestic economic outlook amidst escalating U.S. tariffs and headwinds from overseas conditions, this central bank looks likely to err on the side of caution by staying put once more. The yen has already strengthened nearly 9% versus the dollar by the end of May, which would also explain why the BoJ is not in a rush to continually raise rates at each meeting. Furthermore, pay close attention to BoJ Governor Kazuo Ueda’s press conference, which typically commences one to two hours after the release of the monetary policy statement.

The Dollar Index (DXY)

Key news events today

Retail Sales (12:30 pm GMT)

What can we expect from DXY today?

Consumer spending is expected to register its second monthly decline in 2025. Retail sales have been mixed thus far, and after rising at a monthly rate of 1.7% and 0.1% in March and April, respectively, sales look set to fall 0.5% in May. Despite the ongoing 90-day suspension of tariffs on U.S. imports, consumers appear to be scaling back their spending patterns, a result that would certainly weigh on the greenback.

Central Bank Notes:

• The Board of Governors of the Federal Reserve System voted unanimously to maintain the Federal Funds Rate in a target range of 4.25 to 4.50% on 7 May 2025.
• The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run, but uncertainty around the economic outlook has increased further.
• The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen.
• Although swings in net exports have affected the data, recent indicators suggest that economic activity has continued to expand at a solid pace while the unemployment rate has stabilised at a low level in recent months, and labour market conditions remain solid. However, inflation remains somewhat elevated.
• GDP growth forecasts were revised downward for 2025 (1.7% vs. 2.1% in the December projection) while PCE inflation projections have been adjusted slightly higher for 2025, with core inflation expected to reach 2.5%, partly due to tariff-related pressures.
• In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of its goals.
• Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25B to $5B while maintaining the monthly redemption cap on agency debt and agency mortgage-backed securities at $35B.
• The next meeting is scheduled for 17 to 18 June 2025.

Next 24 Hours Bias

Weak Bullish

Gold (XAU)

Key news events today

Retail Sales (12:30 pm GMT)

What can we expect from Gold today?

Consumer spending is expected to register its second monthly decline in 2025. Retail sales have been mixed thus far, and after rising at a monthly rate of 1.7% and 0.1% in March and April, respectively, sales look set to fall 0.5% in May. Despite the ongoing 90-day suspension of tariffs on U.S. imports, consumers appear to be scaling back their spending patterns, a result that would certainly weigh on the greenback and potentially keep gold prices elevated, especially with ongoing demand for safe-haven assets due to heightened geopolitical tensions in the Middle East.

Next 24 Hours Bias

Weak Bullish

The Australian Dollar (AUD)

Key news events today

No major news events.

What can we expect from AUD today?

After rallying over 1.2% from Monday’s open, the Aussie fizzled out around 0.6550. This currency pair settled around 0.6520 as Asian markets came online, but the upward momentum remains robust.

Central Bank Notes:

• The RBA reduced its cash rate by 25 basis points (bps), bringing it down to 3.85% on 20 May, following a pause on 1 April.
• Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance.
• Data on inflation for the March quarter provided further evidence that inflation continues to ease. At 2.9%, annual trimmed mean inflation was below 3% for the first time since 2021 and headline inflation, at 2.4%, remained within the target band of 2 to 3%.
• While recent tariff announcements have resulted in a rebound in financial market prices, there is still considerable uncertainty about the final scope of the tariffs and policy responses in other countries, contributing to a weaker outlook for growth, employment and inflation in Australia.
• Private domestic demand appears to have been recovering, real household incomes have picked up and there has been an easing in some measures of financial stress. However, businesses in some sectors continue to report that weakness in demand makes it difficult to pass on cost increases to final prices.
• At the same time, a range of indicators suggests that labour market conditions remain tight. Employment is continuing to grow, measures of labour underutilisation are at relatively low rates and business surveys and liaison suggest that availability of labour is still a constraint for a range of employers.
• Looking through quarterly volatility, wage growth has softened over the past year or so but productivity growth has not picked up and growth in unit labour costs remains high.
• There are uncertainties about the outlook for domestic economic activity and inflation stemming from both domestic and international developments. While the central projection is for growth in household consumption to continue to increase as real incomes rise, recent data suggest that the pick-up will be a little slower than was expected three months ago.
• There is a risk that any pick-up in consumption is even slower than this, resulting in continued subdued growth in aggregate demand and a sharper deterioration in the labour market than currently expected.
• With inflation expected to remain around target, the Board therefore judged that an easing in monetary policy at this meeting was appropriate, assessing that this move would make monetary policy somewhat less restrictive.
• The Board will be attentive to the data and the evolving assessment of risks to guide its decisions. In doing so, it will pay close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
• The Board is focused on its mandate to deliver price stability and full employment and will do what it considers necessary to achieve that outcome.
• The next meeting is on 8 July 2025.

Next 24 Hours Bias

Weak Bearish

The Kiwi Dollar (NZD)

Key news events today

No major news events.

What can we expect from NZD today?

After initially gapping lower at Monday’s open, the Kiwi rallied sharply as it hit an overnight high of 0.6087. This currency pair surged nearly 1.6% before settling around 0.6060, with strong tailwinds likely to remain intact on Tuesday.

Central Bank Notes:

• The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 25 basis points bringing it down to 3.25% on 28 May, marking the sixth consecutive rate cut.
• The Committee stated that annual consumer price index inflation increased to 2.5% in the first quarter of 2025 while inflation expectations across firms and households have also risen.
• However, core inflation is declining and there is spare productive capacity in the economy; these conditions are consistent with inflation returning to the mid-point of the 1 to 3% target band over the medium term.
• The New Zealand economy is recovering after a period of contraction as high commodity prices and lower interest rates are supporting overall economic activity but recent developments in the international economy are expected to reduce global economic growth.
• Both tariffs and increased policy uncertainty overseas are expected to moderate New Zealand’s economic recovery and reduce medium-term inflation pressures. However, there remains considerable uncertainty around these judgements.
• Labour market conditions remain weak while the unemployment rate is expected to peak this quarter at 5.2%.
• Inflation is within the target band, and the Committee is well placed to respond to domestic and international developments to maintain price stability over the medium term.
• The next meeting is on 9 July 2025.

Next 24 Hours Bias

Weak Bearish

The Japanese Yen (JPY)

Key news events today

BoJ Interest Rate Decision (Tentative)

BoJ Press Conference (Tentative)

What can we expect from JPY today?

The Bank of Japan (BoJ) will be holding its monetary policy announcement on Tuesday and as per customary practice, the exact time of the press release is unconfirmed, but we should expect it to drop anywhere between 2 and 4 am GMT. After maintaining its key policy rate at 0.5% in May, the BoJ is expected to keep rates steady once more, taking a cautious stance as it focuses on assessing the impact of rising global economic risks on Japan’s fragile recovery. With ongoing uncertainties in the domestic economic outlook amidst escalating U.S. tariffs and headwinds from overseas conditions, this central bank looks likely to err on the side of caution by staying put once more. The yen has already strengthened nearly 9% versus the dollar by the end of May, which would also explain why the BoJ is not in a rush to continually raise rates at each meeting. Furthermore, pay close attention to BoJ Governor Kazuo Ueda’s press conference, which typically commences one to two hours after the release of the monetary policy statement.

Central Bank Notes:

• The Policy Board of the Bank of Japan decided on 1 May, by a unanimous vote, to set the following guidelines for money market operations for the inter-meeting period:
  1. The Bank will encourage the uncollateralized overnight call rate to remain at around 0.5%.
  2. The Bank will continue its plan to reduce the amount of its monthly outright purchases of JGBs, aiming to reach about 3 trillion yen by January-March 2026.
• Japan’s economic growth is likely to moderate, as trade and other policies in each jurisdiction lead to a slowdown in overseas economies and to a decline in domestic corporate profits and other factors, although factors such as accommodative financial conditions are expected to provide support. Thereafter, Japan’s economic growth rate is likely to rise, with overseas economies returning to a moderate growth path.
• The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) is likely to be in the range of 2.0-2.5% for fiscal 2025, in the range of 1.5-2.0% for fiscal 2026, and at around 2% for fiscal 2027. The effects of the past rise in import prices and of the recent rise in food prices such as rice prices – these factors have pushed up the inflation rate so far – are expected to wane.
• Meanwhile, underlying CPI inflation is likely to be sluggish, mainly due to the deceleration in the economy. Thereafter, however, underlying CPI inflation is expected to increase gradually.
• Regarding the employment and income situation, despite the deceleration in the economy, labour market conditions are likely to remain tight, as it will become more difficult for labour supply of women and seniors to increase.
• Comparing the projections through fiscal 2026 with those presented in the previous Outlook for Economic Activity and Prices (Outlook Report), the projected real GDP growth rate for fiscal 2024 is somewhat higher, but the projected growth rates for fiscal 2025 and 2026 are lower due to the effects of trade and other policies in each jurisdiction.
• There are various risks to the outlook. In particular, it is extremely uncertain how trade and other policies in each jurisdiction will evolve and how overseas economic activity and prices will react to them. It is therefore necessary to pay due attention to the impact of these developments on financial and foreign exchange markets and on Japan’s economic activity and prices.
• With regard to the risk balance, risks to economic activity are skewed to the downside for fiscal 2025 and 2026. Risks to prices are also skewed to the downside for fiscal 2025 and 2026.
• The next meeting is scheduled for 17 June 2025.

Next 24 Hours Bias

Weak Bullish

The Euro (EUR)

Key news events today

ZEW Economic Sentiment (9:00 am GMT)

What can we expect from EUR today?

Following a significant drop to -18.5 points in April, the Economic Sentiment Indicator for the Euro Area rebounded in May with a reading of 11.6 points, primarily due to the ongoing 90-day suspension of tariffs imposed by the U.S. on the European Union and other major trading partners. This rebound looks set to continue in June, with the forecast pointing to a reading of 34.8. Coupled with ongoing weakness in the U.S. dollar, the Euro will likely remain in its upward trajectory.

Central Bank Notes:

• The Governing Council reduced the three key ECB interest rates by 25 basis points on 5 June to mark the seventh successive rate cut.
• Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 2.15%, 2.40% and 2.00% respectively.
• Inflation is currently at around the Governing Council’s 2% medium-term target. In the baseline of the new Eurosystem staff projections, headline inflation is set to average 2.0% in 2025, 1.6% in 2026 and 2.0% in 2027. The downward revisions compared with the March projections, by 0.3 percentage points for both 2025 and 2026, mainly reflect lower assumptions for energy prices and a stronger euro. Staff expect inflation excluding energy and food to average 2.4% in 2025 and 1.9% in 2026 and 2027, broadly unchanged since March.
• Staff see real GDP growth averaging 0.9% in 2025, 1.1% in 2026 and 1.3% in 2027. The unrevised growth projection for 2025 reflects a stronger-than-expected first quarter combined with weaker prospects for the remainder of the year. While the uncertainty surrounding trade policies is expected to weigh on business investment and exports, especially in the short term, rising government investment in defence and infrastructure will increasingly support growth over the medium term.
• Higher real incomes and a robust labour market will allow households to spend more. Together with more favourable financing conditions, this should make the economy more resilient to global shocks. Wage growth is still elevated but continues to moderate visibly, and profits are partially buffering its impact on inflation.
• The Governing Council is determined to ensure that inflation stabilises sustainably at its 2% medium-term target. Especially in current conditions of exceptional uncertainty, it will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance.
• The Council’s interest rate decisions will be based on its assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation and the strength of monetary policy transmission, and it is not pre-committing to a particular rate path.
• The asset purchase programme (APP) and pandemic emergency purchase programme (PEPP) portfolios are declining at a measured and predictable pace, as the Eurosystem no longer reinvests the principal payments from maturing securities.
• The next meeting is on 24 July 2025.

Next 24 Hours Bias

Weak Bearish

The Swiss Franc (CHF)

Key news events today

No major news events.

What can we expect from CHF today?

Switzerland’s producer prices fell sharply in May, tumbling 0.5% MoM, as per Monday’s report. Not only did the latest print miss the forecast of a 0.1% increase, but it also marked the first decline in six months. The decrease was driven mainly by lower petroleum prices, with electricity, basic metals, and natural gas also getting cheaper. This unexpected ‘deflationary’ reading may have caused the Swiss franc to give up some of its recent gains as USD/CHF rose marginally on Monday. This currency pair was floating around 0.8150 as Asian markets came online on Tuesday.

Central Bank Notes:

• The SNB eased monetary policy by lowering its key policy rate by 25 basis points, from 0.50% to 0.25% on 20 March 2025, marking the fifth consecutive reduction.
• Underlying inflationary pressure has decreased further this quarter.
• Inflation in the period since the last monetary policy assessment has again been lower than expected, decreasing from 0.7% in November to 0.3% in February, primarily due to lower electricity prices.
• In the shorter term, the new conditional inflation forecast is slightly higher than December: 0.3% for Q2 2025, 0.4% for 2025 overall, and 0.8% for 2026 and 2027, based on the assumption that the SNB policy rate remains at 0.25% over the entire forecast horizon.
• GDP growth in Switzerland remains moderate, with the services sector continuing to show slightly stronger growth, while manufacturing faces challenges.
• The SNB anticipates GDP growth of around 1.0% to 1.5% for 2025.
• The SNB will continue to monitor the situation closely and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
• The next meeting is on 19 June 2025.

Next 24 Hours Bias

Weak Bullish

The Pound (GBP)

Key news events today

No major news events.

What can we expect from GBP today?

Cable continues to remain elevated due to the ongoing weakness in the greenback. This currency pair reached an overnight high of 1.3622 before settling around 1.3570 at the beginning of Tuesday’s Asia session.

Central Bank Notes:

• The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 5 to 4 to reduce the Bank Rate by 25 basis points (bps), bringing it down to 4.25% on 8 May 2025.
• Two members preferred a larger cut of 50 bps, while two opted to hold rates steady at 4.5%.
• The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
• Progress on disinflation in domestic price and wage pressures is generally continuing. Twelve-month CPI inflation fell to 2.6% in March from 2.8% in February, close to expectations in the February Report.
• Although indicators of pay growth remain elevated, a significant slowing is still expected over the rest of the year.
• Wholesale energy prices have fallen back since the February Report. Previous increases in energy prices are still likely to drive up CPI inflation from April onwards, to 3.5% for 2025 Q3, but is expected to fall back thereafter.
• Underlying UK GDP growth is judged to have slowed since the middle of 2024 and has been much less volatile than growth in headline GDP – growth was expected to have been around zero in 2025 Q1, well below Bank staff’s projection for headline growth of 0.6%.
• Underlying employment growth has also softened recently and the labour market has continued to loosen. The ratio of vacancies to unemployment has fallen further and is now judged to be below its equilibrium level – the impact of higher Employers’ National Insurance Contributions (NICs) on employment appears to have been fairly small to date.
• Based on the Committee’s evolving view of the medium-term outlook for inflation, a gradual and careful approach to the further withdrawal of monetary policy restraint is appropriate and it will continue to monitor closely the risks of inflation persistence and what the evolving evidence may reveal about the balance between aggregate supply and demand in the economy.
• Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
• The next meeting is on 19 June 2025.

Next 24 Hours Bias

Weak Bearish

The Canadian Dollar (CAD)

Key news events today

No major news events.

What can we expect from CAD today?

With the U.S. dollar falling out of favour amongst investors and traders alike while oil prices rally strongly, demand for the Loonie remains robust as USD/CAD tumbled as low as 1.3539 on Monday. With no major domestic catalysts on Tuesday, the direction for this currency pair is likely to be dictated by the ongoing geopolitical tensions in the Middle East as well as the API report on U.S. inventory levels.

Central Bank Notes:

• The Bank of Canada maintained its target for the overnight rate at 2.75%, with the Bank Rate at 3% and the deposit rate at 2.70% on 4th June – marking the second consecutive meeting where rates were kept on hold.
• The Governing Council noted that the ongoing increase and decrease of various U.S. tariffs, coupled with highly uncertain outcomes of bilateral trade negotiations and tariff rates remaining well above their levels at the beginning of 2025, placed downside risks on growth and lifted inflation expectations, warranting caution regarding the continuation of monetary easing.
• The higher uncertainty stemmed from the absence of a clear tariff path by the U.S. and persistent threats of new trade actions, which prompted the BoC Governing Council to highlight risks such as the extent to which higher US tariffs reduce demand for Canadian exports.
• Canada’s economic growth in the first quarter came in at 2.2%, slightly stronger than the original forecast, while the composition of GDP growth was largely as expected. Consumption slowed from its very strong fourth-quarter pace, but continued to grow despite a large drop in consumer confidence.
• Housing activity was down, driven by a sharp contraction in resales, while government spending also declined. The economy is expected to be considerably weaker in the second quarter, with the strength in exports and inventories reversing and final domestic demand remaining subdued.
• The labour market has weakened, particularly in trade-intensive sectors, and unemployment has risen to 6.9% while CPI inflation eased to 1.7% in April, as the elimination of the federal consumer carbon tax reduced inflation by 0.6%.
• The Bank’s preferred measures of core inflation, as well as other measures of underlying inflation, moved up, while recent surveys indicate that households continue to expect that tariffs will raise prices and many businesses say they intend to pass on the costs of higher tariffs.
• The Governing Council will continue to assess the timing and strength of both the downward pressures on inflation from a weaker economy and the upward pressures on inflation from higher costs while proceeding carefully, with particular attention to the risks and uncertainties facing the Canadian economy.
• The Governing Council will focus on ensuring that Canadians continue to have confidence in price stability through this period of global upheaval by supporting economic growth while ensuring that inflation remains well-controlled.
• The next meeting is on 30 July 2025.

Next 24 Hours Bias

Medium Bearish

Oil

Key news events today

API Crude Oil Stock (8:30 pm GMT)

What can we expect from Oil today?

After surging as high as $77.50 on Monday following Israel’s attack on Iran over the weekend, WTI oil futures pulled back sharply to settle around $71.80 per barrel. Oil prices initially rallied over 6% as the conflict intensified and U.S. President Donald Trump urged “everyone” to evacuate Tehran, increasing the prospect of escalating unrest in the region and potential disruptions to oil supply, particularly through the Strait of Hormuz. Iran is the third-largest producer among members of the Organization of the Petroleum Exporting Countries (OPEC), and the hostilities could cause major disruptions. Moving over to U.S. inventories, the API stockpiles have declined for three straight weeks, averaging a drawdown of 2.6 million barrels over this period. The uptick in demand for crude oil coincides with the peak summer driving season in the U.S., and for other countries in the Northern hemisphere. Continued drawdowns in storage levels would likely provide another tailwind for oil prices later today.

Next 24 Hours Bias

Weak Bullish

The post IC Markets Asia Fundamental Forecast | 17 June 2025 first appeared on IC Markets | Official Blog.

It is reported that the US Commerce Department would have expanded export limits on key technology to China if the talks in London did not go according to plan. The sources mentioned that the US weighed tougher limits on semiconductors, which includes cutting off China from a wider array of chip-manufacturing equipment. I mean, all of this is now a moot point as the talks ended up being more cordial. But it shows that at any point, both sides are more than ready to sling mud at each other again in a blink of an eye.

This article was written by Justin Low at www.forexlive.com.

• We have been consistently clear that Iran can never have a nuclear weapon
• Urges that resolution of the crisis can lead to broader de-escalation of hostilities in the region
• Reaffirms that Israel has a right to defend itself
• We reiterate our support for the security of Israel
• Will remain vigilant on the implications for international energy markets and stand ready to coordinate

A blanket statement which just reaffirms their position, nothing more. There will be watchful eyes on what comes next from Washington though as Trump cut his visit to Kananaskis short amid the tensions in the Middle East.

This article was written by Justin Low at www.forexlive.com.

Trump is proposing talks with Iran this week on nuclear deal, ceasefire:

• Meeting to occur between US envoy Witkoff and Iran Foreign Minister Abbas Araghchi

Axios cite four sources ‘briefed on the issue’.

This article was written by Eamonn Sheridan at www.forexlive.com.

News is here from earlier:

• Reports that three ships are on fire in the Gulf of Oman near the strait of Hormuz.
• Oil prices up after reports of 3 ships on fire in Gulf of Oman near the strait of Hormuz

Three tankers are reportedly on fire at the Khor Fakkan anchorage near Fujairah, off the coast of the UAE.

• The incident raises concerns of a possible repeat of the 2019 attacks, which were widely attributed to Iran during heightened tensions under Trump’s “maximum pressure” campaign.
• Notably, the location is the same as in those earlier strikes.
• One of the vessels currently ablaze could be the ADALYNN. The exact cause remains unclear. ADALYNN is a crude oil tanker.

The initial reports came with this pic.

This article was written by Eamonn Sheridan at www.forexlive.com.

• Oil prices up after reports of 3 ships on fire in Gulf of Oman near the strait of Hormuz
• Reports that three ships are on fire in the Gulf of Oman near the strait of Hormuz.
• MUFG BOJ Preview – Bank set to hold rates steady, may fine-tune bond tapering pace
• US Secretary of State Rubio is leaving the G7 early, heading back to DC
• Trump to leave G7 after resisting joint statement on Israel-Iran conflict
• PBOC sets USD/ CNY central rate at 7.1746 (vs. estimate at 7.1820)
• Japan fin min Kato says no plan for talks with Bessent at present
• White House denies the US is attacking Iran
• Japan’s finance minister Kato expresses concern about oil supply, prices
• Trump says its ‘very important’ that he heads back to DC early
• Singapore exports have fallen in May vs a rise that was expected
• U.S. official says no intention of initiating offensive operations against Iran
• Risk assets selling off on Trump National Security Council news … but wait!
• Chinese embassy in Israel advises Chinese citizens to leave Israel ASAP
• Fox reporting that Trump requests NSC be prepared in Situation Room
• France’s Macron says it good that Trump has left the G7 early
• Trump is leaving the G7 summit EARLY and will return to DC tonight.
• Trump’s ‘evacuate Tehran’ tweet is all about getting Iran to negotiate says White House
• New Zealand Food Price Index for May 2025 +0.5% m/m (prior +0.8%)
• Japan PM Ishiba says did not reach trade deal agreement with Trump
• “Carney and Trump commit to reaching trade deal within 30 days”
• Trump says everyone should immediately evacuate Tehran
• UBS forecasts gold to $3,500/oz
• US plans a 100K annual quota for UK auto imports at 10% tariff rate
• Trump expected to offer Iran ‘last-chance’ proposal (US and European sources)
• US is accelerating the deployment of additional aircraft carrier group to the Middle East
• Trump says on Iran that we will do something after leaving G7
• Trump says he signed document finalizing trade deal with the UK
• EV news (TSLA), US Senate Republicans plan to end the US$7500 tax credit
• Here’s the ‘red line’ that if Iran crosses will drag the US into the war
• Forexlive Americas FX news wrap: US dollar reverses losses as G7 begins
• US stock markets close with strong gains
• Trade ideas thread – Tuesday, 17 June, insightful charts, technical analysis, ideas

The first market-moving development overnight came via Truth Social, where former U.S. President Donald Trump warned: “Iran should have signed the ‘deal’ I told them to sign… IRAN CANNOT HAVE A NUCLEAR WEAPON… Everyone should immediately evacuate Tehran!”

• The post triggered a brief bout of risk aversion:

  • WTI crude rose from around $71 to $72.15

  • S&P 500 futures (ES Jun) slipped from 6031 to ~6021

  • Gold edged higher

A White House official told CNN the social media post reflected the urgency of the situation and the administration’s desire to push Iran back to the negotiating table as hostilities with Israel escalate.

Sentiment soured further as news broke that Trump would leave the G7 summit early to return to Washington, with the White House saying he needed to “attend to many important matters.” Risk assets extended losses on headlines that Trump had also instructed the National Security Council (NSC) to prepare in the White House Situation Room for h

Markets later retraced some of the moves after a U.S. official said there is no intention to launch offensive operations against Iran, and reports surfaced that Trump was, in fact, staying for the G7 dinner.

As the session progressed, unconfirmed reports emerged of three ships on fire in the Gulf of Oman, near the Strait of Hormuz. That sent Brent crude sharply higher, rising toward $75/bbl.

This article was written by Eamonn Sheridan at www.forexlive.com.

Info here – Reports that three ships are on fire in the Gulf of Oman near the strait of Hormuz.

This is said to be an image:

Brent circa 74.60 from lows around 73.70 or earlier

This article was written by Eamonn Sheridan at www.forexlive.com.

Reports that there are three ships on fire in the Gulf of Oman near the strait of Hormuz.

Social media sources so far.

Trying to confirm.

Oil is moving higher, which may be a support for the info. Be aware that its of a chicken/egg situation at times like this.

This article was written by Eamonn Sheridan at www.forexlive.com.

US Secretary of State Rubio is leaving the G7 early, heading back to DC.

As is his boss. Its been a busy session for news on Trump leaing the G7:

• Trump says everyone should immediately evacuate Tehran (the White House played this down: Trump’s ‘evacuate Tehran’ tweet is all about getting Iran to negotiate says White House)
• Trump is leaving the G7 summit EARLY and will return to DC tonight.
• Fox reporting that Trump requests NSC be prepared in Situation Room

• Trump says its ‘very important’ that he heads back to DC early
• Trump to leave G7 after resisting joint statement on Israel-Iran conflict

This article was written by Eamonn Sheridan at www.forexlive.com.