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Weekly FX Chartbook: Heavy central bank focus as FOMC, BOJ, BOE, SNB, RBA meet

Forex 5 minutes to read
Charu Chanana 400x400
Charu Chanana

Head of FX Strategy

Summary:  Bank of Japan’s pivot away from negative rates is becoming a baseline view ahead of Tuesday’s announcement, but gains in the Japanese yen could remain limited by dovish commentary and risks of a hawkish surprise by the Fed the next day. Two-way risks for the dollar this week as markets anticipate a hawkish shift in dot plot, but CHF sees downside risks as SNB can surprise with a rate cut or stronger FX language. GBP also has a lot at stake this week with BOE meeting vote split and Nvidia-driven equity momentum in focus.

18_FX_Weekly
USD strength was back to the fore last week after hot CPI and PPI prints reaffirmed the yield advantage. Activity currencies like NOK, SEK and NZD had the most to lose, while JPY also remained on the backfoot despite strong wage growth signals.
18_FX_Momentum
Our FX Scorecard shows strong momentum in metals, although USD strength is taking away some of their shine particularly for Gold.
18_FX_Positioning
Forex COT to the week of March 12 indicated non-commercial flows were mixed and the aggregate dollar long was cut by over 60%. Speculators bought JPY, EUR and GBP while selling CAD, AUD and NZD. Worth noting that sterling long positioning is the highest since 2007.
18_FX_Views

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Other recent Macro/FX articles:

18 Mar: Global Market Quick Take - Asia
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