FUNDAMENTAL OVERVIEWUSD:The US dollar is now trading higher against most major currencies after the hot US NFP report and the slightly soft US CPI data of last week. The market is still pricing 58 bps of easing by year-end but the crowded bearish positioning on the US dollar requires strong reasons for the greenback to keep falling. There’s no such reason right now, on the contrary, we are seeing the US data surprising to the upside. Fed speakers are also sounding like the bar for further cuts was set high and they would need very clear improvement on the inflation side to consider a rate cut.The US-Iran tensions could also be a positive for the US dollar in case a war breaks out. In fact, given the severity of the risk aversion that would be triggered by such an event, traders would likely be more inclined to buy the greenback. Today, we get the US Jobless Claims data but unless we see meaningful deviations, the market is unlikely to move much on it. Tomorrow, we get the Flash US PMIs and the US Q4 GDP. The greenback might get another boost from strong data, especially on the PMIs front. We have also the potential US Supreme Court decision on Trump’s tariffs tomorrow. If the Court were to rule against the tariffs, we could see the US dollar weakening on positive global growth expectations.AUD:On the AUD side, the currency failed to sustain a rally on another strong jobs report. The market pricing has also remained the same with traders seeing 42 bps of tightening by year-end. This might be a signal that we reached the peak in the hawkish repricing, and a major pullback might follow. We will likely need hot CPI data to see more upside for the currency at this point. As a reminder, the RBA hiked the Cash Rate by 25 bps at the last meeting bringing it back to 3.85%. The central bank delivered a hawkish surprise as it signalled two more rate hikes by year-end compared to just one expected by the market at the time. AUDUSD TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that AUDUSD pulled back to the first upward trendline. This is where we can expect the dip-buyers to step in with a defined risk below the trendline to position for a rally into new highs. The sellers, on the other hand, will look for a break lower to extend the drop into the next trendline around the 0.69 handle. AUDUSD TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see that the price is consolidating between the 0.7090 resistance and the trendline. The most recent low at 0.7027 could still act as support and avoid a major breakdown, but if the price falls below it, the sellers should have free room till the 0.69 support. AUDUSD TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much else we can add here as the buyers will likely step in around the trendline and the 0.7027 low to keep targeting new highs, while the sellers will look for breaks to pile in for a drop into the 0.69 support next. The red lines define average daily range for today. UPCOMING CATALYSTSToday we get the latest US Jobless Claims figures. Tomorrow, we conclude the week with the US Q4 GDP, the US PCE price index for December, the US Flash PMIs and a potential US Supreme Court decision on Trump’s tariffs. Watch out for US-Iran headlines as well. This article was written by Giuseppe Dellamotta at investinglive.com.

We are getting close to some sense of where monetary policy is balanced between the inflation objective and full employmentThe unemployment rate has gone up and that's very much of a concernOn January inflation data: these are good numbers from headline perspective and also from coreWith respect to core inflation, not quite as good as we had hoped to seeHard to tell whether 2% inflation that we are likely to see in the next few months is in fact a sustainable 2%Food inflation key factor in my decision makingBoE's Mann is usually labelled as a hawk but she's been switching between hawkish and dovish views pretty quickly based on the evolution of the data.Mann notes that the Bank is approaching a neutral point where interest rates are effectively balancing the dual goals of curbing inflation and supporting full employment. She expressed concern over the rising unemployment rate (recently hitting a five-year high of 5.2%). She specifically pointed to sharp minimum wage increases as a potential factor in rising youth unemployment, though she cautioned against viewing this as a definitive "canary in the coal mine" for a total economic collapse.She acknowledged that January's inflation data (falling to 3.1%) looked positive on the surface. However, she was less satisfied with core inflation, which has not cooled as quickly as she had hoped. While the UK is expected to hit the 2% inflation target in the coming months, Mann remains skeptical about whether it will stay there. She is looking for more evidence that wage-setting and service-sector pricing have truly adjusted before she is fully convinced that the 2% level is sustainableMann’s tone has softened due to the weakening jobs market, but her "activist" policymaker roots remain. She is currently prioritizing certainty over speed, wanting to ensure that once inflation hits 2%. At the last policy meeting, she voted to keep the Bank Rate unchanged. Based on these comments, she would likely keep rates steady again if she had to vote now.Even if she voted for no change, the policy changes are decided on a majority basis. The market is pricing an 82% chance of a rate cut at the next meeting in March following the soft employment and inflation reports. The last vote split was 5-4 to keep rates unchanged. Right now, it should be minimum 5-4 in favour of a rate cut as Governor Bailey is widely expected to vote for a cut. This article was written by Giuseppe Dellamotta at investinglive.com.

FUNDAMENTAL OVERVIEWThe Nasdaq failed to rally on the slightly soft US CPI report last Friday and continued to range. We now have another major risk for the market as a potential US-Iran war could trigger a big selloff. In fact, we got a report from Axios yesterday suggesting that a war between the U.S. and Iran now appears increasingly likely. According to the sources cited, there is currently no sign of a diplomatic breakthrough between Washington and Tehran, which is irritating Trump.They also noted that, given Trump’s recent military build-up and escalated rhetoric, it may be difficult for him to de-escalate without Iran offering significant concessions on its nuclear program. The report added that any military operation in Iran would be massive, involving a weeks-long campaign that would resemble a full-fledged war.If a military conflict were to break out, we would see oil prices skyrocket due to the risk of disruption in the Strait of Hormuz, especially in light of the recent military drills. This would be a negative shock for the global economy and lead to stagflation risks. The first reaction in the markets would be strong risk aversion. We would highly likely see a huge selloff in the stock market as future growth expectations would turn negative.Another important event is tomorrow’s potential US Supreme Court decision on Trump’s tariffs. In fact, if the Supreme Court were to rule against the tariffs, we will likely see the stock market rallying on positive growth expectations but the weekend risk around Iran could keep a lid on gains. Traders will likely err on the cautious side heading into the weekend. NASDAQ TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see the Nasdaq has been trading in a wide range since October of last year. Such long consolidations generally lead to big trending moves once the price breaks out. Until then, the market participants will continue to play the range. NASDAQ TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see a downward trendline defining the bearish momentum. The sellers continue to lean on the trendline with a defined risk above it to keep pushing into new lows. The buyers, on the other hand, will want to see the break higher to pile in for a rally into the 25,400 level next.NASDAQ TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much we can add here but the most recent higher low around the 24,750 level defines the bullish structure on this timeframe. If the price falls to that level, we can expect the dip-buyers to step in with a defined risk below the level to target a break above the downward trendline. The sellers, on the other hand, will look for a break lower to increase the bearish bets into the February lows next. The red lines define the average daily range for today. UPCOMING CATALYSTSToday we get the latest US Jobless Claims figures. Tomorrow, we conclude the week with the US Q4 GDP, the US PCE price index for December, the US Flash PMIs and a potential US Supreme Court decision on Trump’s tariffs. Watch out for US-Iran headlines as well. This article was written by Giuseppe Dellamotta at investinglive.com.

The report mostly highlights how the US has been pressuring Canada on multiple fronts to get what they want out of any deal. And the crux of it mostly underscores the notion that the US administration currently views that the USMCA pact is not one that is set in stone. That being it is a deal that they could easily walk away from and look to explore separate bilateral deals with Canada and Mexico instead.If so, that will make things more fractured in terms of economic and trade ties between the three countries. But as we know with Trump, he won't ascribe to something if he is not totally on board with the idea. And he's more than willing to inflict pain, no matter what the consequences might be. It's a double-edged sword really.In this case, the US really wants to force trade concessions out of Canada. And if they can't do that, then they are more than willing to pursue a route in leaving Canada on the outs in negotiating another deal with Mexico. That of course by leaving the USMCA agreement dead in the water.I think a lot of this is baked into market expectations already. That being there won't be a renewal to the USMCA pact and that there will be another prolonged process of economic negotiations going back and forth.However, the actual economic impact of it all is still something that needs to be accounted for. That especially if more tariffs start to come into the picture. And knowing how much Trump loves his tariffs, that will certainly be a key risk event to watch out for.The full report by the NYT can be found here (may be gated). This article was written by Justin Low at investinglive.com.

Here are a couple of views from market analysts on the EUR/USD currency pair, with it hovering around the "sweet spot" for the ECB. As we know, the central bank is viewing it as being "complicated" if price does move towards the 1.20 level. So, keeping as it is now would be somewhat comfortable for policymakers - especially in that 1.16 to 1.18 range.Goldman Sachs notes that:"With EUR/USD hovering around our 3m 1.18 forecast, we still see further upside ahead in the coming months. While it is true that there is a much more limited valuation case to expect further euro appreciation, and it is far from a pro-cyclical currency, the euro still stands to benefit from many of the themes we expect to persist in FX markets this year. Most notably, currency markets have been remarkably correlated, and EUR/USD continues to trade tightly with the broad dollar. Rather than leading the way as it did in early 2025, we expect the euro to ride the tailwinds of broad dollar depreciation."Their argument mostly ties to a continuation in the de-dollarisation narrative. And that seems likely to be the case in the first half of the year at the very least.Morgan Stanley also chimes in with a similar view on the currency pair in saying that:"Risks remain asymmetrically skewed toward USD downside. Robust US labour market data may support risk currencies versus USD but may make it more difficult for the DXY to fall as investors prefer other funders. EUR/USD risks remain clearly skewed to the upside, in our view, though we think current levels are less attractive for long positions to enter; a pullback to below 1.1750 would be an attractive entry level." This article was written by Justin Low at investinglive.com.

This builds on the headlines from yesterday:ECB president Lagarde reportedly poised to leave the central bank before her term expiresECB says Lagarde remains committed to her role as presidentThe latest report here cites four sources in saying that Lagarde told colleagues in a private message that she remains focused on her job as ECB president for now. And that if she were about to step down, they will be the first to be informed about that decision.The recipients of the message took that to mean that she was not about to resign earlier than her term dictates. That after rampant speculation yesterday that she might do so before April next year, right before the French presidential elections.The report adds that Lagarde's message was to reassure them that she was still concentrating on her role at the ECB and that they will hear from her directly, not the press, on her intentions to step down as president of the central bank.That said, some recipients said that this likely just means Lagarde will not depart the ECB in the immediate term but she also did not close the door to such a possibility.Well, the report here fits with what we saw in the previous episode in the summer last year. That was when Lagarde was heavily linked with taking up a role at the WEF and perhaps leaving her ECB post earlier than anticipated as well. So, this is very much a repeat of that in which she also goes out of her way to reassure members at the central bank that she is still committed to the job.In any case, it seems like she did not outright refute the report and is just mainly stating that she won't be distracted from her current duties - at least for now. That says a lot as she could've just outright state that she will not be departing from the ECB earlier than her term dictates it to be. Instead, she's sidestepping that with a blanket statement of commitment. I think we all can extrapolate from that. This article was written by Justin Low at investinglive.com.

FUNDAMENTAL OVERVIEWOil prices recouped all last week’s losses as risks of a US-Iran conflict increased. In fact, we got a report from Axios suggesting that a war between the U.S. and Iran now appears increasingly likely. According to the sources cited, there is currently no sign of a diplomatic breakthrough between Washington and Tehran which is irritating Trump.They also noted that, given Trump’s recent military build-up and escalated rhetoric, it may be difficult for him to de-escalate without Iran offering significant concessions on its nuclear program. The report added that any military operation in Iran would be massive, involving a weeks-long campaign that would resemble a full-fledged war.If a military conflict were to break out, we would see oil prices skyrocket due to the risk of disruption in the Strait of Hormuz, especially in light of the recent military drills. Traders are piling in into oil longs given the weekend risk. In fact, the Axios report added at the end that U.S. officials said after Tuesday's talks that Iran needs to come back with a detailed proposal in two weeks. But here’s the kicker: last June, the White House set a two-week window for Trump to decide between further talks or strikes. Three days later, he launched Operation Midnight Hammer.Another important event is tomorrow’s potential US Supreme Court decision on Trump’s tariffs. In fact, if the Supreme Court were to rule against the tariffs, we will likely see oil prices surging on positive growth expectations.CRUDE OIL TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that crude oil bounced at the support zone around the 62.35 level and it’s now approaching the key 66.43 resistance. That’s where we can expect the sellers to step in with a defined risk above the resistance to position for a drop back into the support. The buyers, on the other hand, will look for a break higher to increase the bullish bets into the 70.50 level next. CRUDE OIL TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see more clearly the rangebound price action between the 62.35 support and the 66.43 resistance. Market participants will likely continue to play the range until we get a breakout on either side. CRUDE OIL TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much we can add here as the sellers will likely step in around the resistance to position for a drop back into the support, while the buyers will look for a breakout to extend the rally into the 70.50 level next. The red lines define the average daily range for today.UPCOMING CATALYSTSToday we get the latest US Jobless Claims figures. Tomorrow, we conclude the week with the US Q4 GDP, the US PCE price index for December, the US Flash PMIs and a potential US Supreme Court decision on Trump’s tariffs. Watch out for US-Iran headlines as well. This article was written by Giuseppe Dellamotta at investinglive.com.

The present situation catch up is that Switzerland is squaring off against deflationary pressures once again. While not quite yet reaching deflation territory, the worries are mounting as inflation pressures have fallen off dramatically in the second half of last year. Core prices are still hanging in there but it feels like only a matter of time before the issue becomes bigger than it is now.And for the SNB, the central bank just does not want to fall back into the rabbit hole of having to start using unconventional monetary policy measures once again. When that sticks, we've seen before how difficult it can be to get out of the rut. The Covid pandemic gave them a get out of jail free card but that has now expired as the deflation era looks set to return.To compound matters for the Swiss central bank, a stronger franc currency is making the situation even more difficult. That just adds to the deflationary impact and puts the SNB in a tough spot in trying to avoid a return to negative interest rates.The EUR/CHF is one that is less talked about in the past weeks but is one that is worth taking note of:The SNB looked to have drawn a line previously when the currency pair hit the 0.92 level but that has given way in late January. And we're seeing the franc continue to nudge higher still with the pair inching towards 0.91 now.The big question is where does the SNB draw the line next in terms of intervening to limit the franc strength? And how much are they willing to go up against market sentiment?As such, escalating US-Iran tensions are coming at an unfortunate timing for the central bank. Amid the de-dollarisation narrative and the yen facing its own set of problems back home, the franc is the only game in town for currency traders seeking safe haven.And that will just put more downside pressure on EUR/CHF, which is already at record lows this week. That in turn will just add more woes to the SNB in trying to manage their inflation mandate. And eventually, having to possibly look to negative rates to also deter further strength in the franc currency alongside dealing with deflation pressures. This article was written by Justin Low at investinglive.com.

Hanzawa says that: "There is a reasonable possibility that the BOJ will raise interest rates as early as in March or April."For now, markets are not really expecting one to come next month at least. That as the Japanese central bank will still have to wait on how the spring wage negotiations play out. The next policy meeting will take place on 19 March, and traders are pricing in ~89% of no change to interest rates.As for the 28 April meeting, the odds of that are skewed to the other side. Traders are instead pricing in a ~64% probability of a 25 bps rate hike to take the policy rate to 1.00%.Despite pressure from the Takaichi government, policymakers at the central bank continue to stick to their guns for the most part. So far though, they are not really wanting to get involved in interfering with the yen currency. And for the most part, they are just focusing on the inflation battle still.But amid plans by the government to increase fiscal spending, they are hoping the BOJ will play ball so as to not raise interest rates any time soon. That conflict is what is also in part driving much tension in market sentiment towards Japan, with the yen and Japanese government bonds being sold heavily.In looking to the March and April meetings, it will be important to look out for BOJ commentary once we get more details on how the spring wage negotiations develop in the weeks ahead. We'll find out the numbers soon enough. However, I would argue that it is going to be a similar case to last year. That is if the BOJ wants to get on with rate hikes, they'd better not rest on their laurels and get a move on. The timing window will just continue to close in on them, that especially since wage hikes this year are not expected to be as strong as last year - even if they are going to be at a reasonably higher level historically.It is expected that wage talks will result in a 5% pay hike or higher once again. And that is keeping alive expectations for the BOJ to at least bring the policy rate to 1% by mid-year. This article was written by Justin Low at investinglive.com.

FUNDAMENTAL OVERVIEWGold started to find some footing yesterday as risks of a US-Iran conflict increased. In fact, we got a report from Axios suggesting that a war between the U.S. and Iran now appears increasingly likely. According to the sources cited, there is currently no sign of a diplomatic breakthrough between Washington and Tehran.They also noted that, given Trump’s recent military build-up and escalated rhetoric, it may be difficult for him to de-escalate without Iran offering significant concessions on its nuclear program. The report added that any military operation in Iran would be massive, involving a weeks-long campaign that would resemble a full-fledged war.If a military conflict were to break out, we would see oil prices skyrocket due to the risk of disruption in the Strait of Hormuz, especially in light of the recent military drills. This would be a negative shock for the global economy and lead to stagflation risks.Stagflation is the best environment for gold, so we would highly likely see the price rallying into a new record high very quickly. This risk should keep the market supported in the short-term but if we get some clear de-escalation, like the US military withdrawing for example, traders will quickly turn their focus back to the data and the Fed’s interest rate path which is likely to continue to weigh on gold given the improvements.Another risk is tomorrow’s potential US Supreme Court decision on Trump’s tariffs. In fact, if the Supreme Court were to rule against the tariffs, gold could experience another selloff on positive growth expectations.GOLD TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that gold is still consolidating right in the middle of the all-time high and the major trendline. From a risk management perspective, the buyers will have a better risk to reward setup around the trendline to target new all-time highs, while the sellers will look for a break lower to extend the drop into the 4000 level next.GOLD TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we can see that the price broke above the downward trendline and the buyers piled in to target the key resistance zone around the 5100 level. If the price gets there, we can expect the sellers to step in again with a defined risk above the resistance to position for a drop into new lows. The buyers, on the other hand, will look for a break higher to increase the bullish bets into new record highs.GOLD TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we have a minor upward trendline now defining the bullish momentum on this timeframe. We can expect the buyers to keep leaning on the trendline with a defined risk below it to keep targeting the key resistance zone around the 5100 level. The sellers, on the other hand, will look for a break lower to pile in for a drop into new lows. The swing low at 4960 will be the last line of defence for the buyers as a break below it should open the door for a fall into the 4878 level. The red lines define the average daily range for today. UPCOMING CATALYSTSToday we get the latest US Jobless Claims figures. Tomorrow, we conclude the week with the US Q4 GDP, the US PCE price index for December, the US Flash PMIs and a potential US Supreme Court decision on Trump’s tariffs. Watch out for US-Iran headlines as well. This article was written by Giuseppe Dellamotta at investinglive.com.

EUROPEAN SESSIONIn the European session, we don't have anything on the agenda other than a couple of low tier releases that won't change anything for the respective central banks. The focus remains on the US-Iran tensions as risks of a military conflict increased following yesterday's Axios report saying that a war was looking increasingly likely due to no evidence of a diplomatic breakthrough. Traders might want to err on the cautious side going into the weekend.AMERICAN SESSIONIn the American session, the main highlight will be the US jobless claims data. Initial claims are expected at 225K vs 227K prior, while continuing claims are seen at 1860K vs 1862K prior. The labour market data has been showing gradual improvement and stabilisation, which raised the bar for rate cuts. The data is unlikely to lead to major market moves at this point unless we get some notable deviations.CENTRAL BANK SPEAKERS13:20 GMT/08:20 ET - Fed's Bostic (hawkish - non voter)13:30 GMT/08:30 ET - Fed's Bowman (dovish - voter)14:00 GMT/09:00 ET - Fed's Kashkari (hawkish - voter)15:30 GMT/10:30 ET - Fed's Goolsbee (neutral - non voter) This article was written by Giuseppe Dellamotta at investinglive.com.

There are a couple to take note of on the board for the day, as highlighted in bold below.The first ones are for EUR/USD at the 1.1790-00 levels. The expiries don't tie to any technical significance but could play a key role in terms of limiting price action on the day. The expiries are likely to act as magnets to pull price action during the session ahead, keeping a more confined range for traders to play with. That at least until they roll off later in the day.The same applies to the one for USD/JPY at the 155.00 level as well. The expiries could double up as a pull factor to keep price action more limited, even as the upside momentum starts to gain traction after the jump yesterday.That being said, I would attach more significance to the expiries in EUR/USD than the ones for USD/JPY in the day ahead.The magnetic pull towards 1.1800 and in keeping price action more muted is of more influence. That as opposed to USD/JPY, which is starting to break higher after a bit of consolidation since last week previously. Still, don't discount the potential impact of the expiries.Barring any major headline risks in European morning trade, they are ones to possibly play a role in terms of influencing price action in the session ahead.For more information on how to use this data, you may refer to this post here.Head on over to investingLive (formerly ForexLive) to get in on the know! This article was written by Justin Low at investinglive.com.

In wrapping up the 2025 year, foreign holdings of US Treasuries dropped slightly in December to $9.27 trillion. That compares with the peak seen in November at $9.36 trillion. The $88.4 billion drop might not seem much but it still represents the largest monthly decline since late 2022. But after hitting a record high in November, I think we can give that a pass.That especially if we put things more into context. The 2025 year-end figure still marks a massive year for US debt demand, with it being well above the $8.5 trillion at the end of 2024.So, what can we make of the trend and the data from the report yesterday?There are just a couple of things that stand out from the chart above.The first of course being the glaring and continued decline in China's holdings of US Treasuries. The figure dropped to $683.5 billion by the end of 2025, which is the lowest since 2008. The total reduction in China's holdings for the whole of last year was over $200 billion. So, it keeps up with the trend we're seeing since the peak in 2013.That being said, the important detail when looking into this report is to not take the numbers at face value. It is best to remember that the numbers here are only a measure of each country's holdings of Treasuries in US custodians. The thing about this is that some countries might still buying Treasures via non-US custodians. As such, China likely falls under this category.And these numbers tend to show up in the likes of Belgium and Luxembourg. That is not to say all of it are tied to proxy buying though. Both Belgium and Luxembourg also double as agents to facilitate demand for private financial institutions in Europe especially.As for the UK, it is more so a case of London acting as a global clearinghouse for private international investors. That especially after the Covid pandemic.In essence, the narrative there also highlights the continued shift in trend in terms of structural holdings of Treasuries and US debt.It is no longer central banks being the big players but instead private investors i.e. hedge funds, pension funds, asset managers who are now the dominant buyers. And they have been for quite a while now.As mentioned yesterday, this just means that US funding is now becoming more increasingly dependent on market-based capital and not so much so on reserve recycling. To put things more simply, it's more about yield and financial demand rather than being a case of a geopolitical feature.And for all the negativity surrounding the dollar and US assets since last year, foreign demand for Treasuries remain strong. The total holdings by foreign investors last year even showed a staggering increase of $770 billion over the course of 2025.That's good news for the US administration as they continue to balance on a very fine tightrope on the fiscal side of things. But even as foreign demand is holding up just enough to keep the engine running, the fiscal cost continues to put a stranglehold on the government.And now with the "financialisation" shift in who is demanding Treasuries, that creates a bigger risk especially since private investors are more price/yields sensitive. That in turn also creates the risk for more potential yield spikes on any major developments. This article was written by Justin Low at investinglive.com.

RBNZ increases policy meeting frequency to eight per year as CPI moves monthly.Summary:RBNZ will increase scheduled policy decisions from 7 to 8 per year starting in 2027Change aligns with move to monthly CPI data from next yearFebruary 2027 decision date brought forward by one weekCommittee retains ability to act between meetings if requiredFinancial Stability Reports remain twice yearly in May and NovemberThe Reserve Bank of New Zealand (RBNZ) will move to eight scheduled monetary policy decisions per year from 2027, increasing from the current seven-meeting format. The shift comes as New Zealand prepares to transition to monthly Consumer Price Index (CPI) releases from next year, significantly increasing the flow of inflation data available to policymakers.The Monetary Policy Committee said the higher frequency of inflation data warrants a corresponding increase in scheduled decision points. With CPI moving from a quarterly to a monthly release schedule, policymakers will have more timely and granular insights into price pressures, allowing for more responsive calibration of interest rate settings.Under the new structure, one additional scheduled decision will be added to the annual calendar. To accommodate the eight-meeting schedule, the previously announced February 2027 decision date has been moved one week earlier. The RBNZ has already published decision dates through February 2028 to provide forward clarity for markets.Importantly, the Committee reiterated that scheduled meetings are not the only opportunities for action. The RBNZ retains the authority to make unscheduled policy decisions at any time should economic or financial conditions warrant it, something it has done in the past during periods of market stress or acute economic disruption.The shift does not alter the frequency of the Bank’s Financial Stability Reports, which will continue to be released twice a year, in May and November.While operational in nature, the decision signals an institutional adjustment to a more data-intensive environment. With inflation data becoming available monthly, the RBNZ is positioning itself to respond more dynamically to evolving price and demand conditions — a structure more in line with other major central banks. This article was written by Eamonn Sheridan at investinglive.com.

Posting this ICYMI from a Wednesday note from Morgan Stanley. Morgan Stanley says Nvidia is the most under-owned megacap as institutions lag tech benchmarks.Summary:Morgan Stanley says mega-cap tech is the most under-owned in 17 yearsNvidia is the most under-owned large-cap tech stockInstitutional ownership lags S&P 500 weightings across major megacapsInvestors show bias toward AI “picks and shovels” hardware namesSNDK stands out as the most over-owned large-cap tech stockMorgan Stanley’s latest analysis of fourth-quarter 13F filings highlights a striking positioning gap in US equities: mega-cap technology stocks are the most under-owned relative to the S&P 500 in 17 years.According to the bank, the ownership gap versus the benchmark widened to negative 155 basis points by the end of the quarter, underscoring how active institutional managers remain structurally underweight some of the largest names in the index despite their dominant market capitalisations.Among individual stocks, Nvidia stands out as the most under-owned large-cap technology name. Analyst Erik Woodring calculates a negative 2.57 percentage point gap between Nvidia’s S&P 500 weighting and active institutional ownership. Apple and Microsoft follow closely behind with gaps of negative 2.16% and negative 2.13%, respectively, while Amazon shows a negative 1.37% gap.The data suggest that even after a prolonged AI-driven rally, active managers have not fully caught up to benchmark allocations in these mega-cap leaders. Woodring notes that the modest widening in under-ownership from the prior quarter implies investors continue to lag index weightings rather than aggressively rotate back into the largest constituents.However, the positioning story is not uniform across the technology sector. Morgan Stanley sees a clear institutional bias toward AI “picks and shovels” names entering 2026. Semiconductor and hardware stocks such as SNDK, KLAC, WDC, LRCX and STX show elevated ownership levels, reflecting investor preference for infrastructure beneficiaries of AI spending. By contrast, institutional positioning in software names including IBM, ORCL, PANW, NOW and ADBE remains notably light.One standout is SNDK, whose institutional ownership has steadily increased since its re-listing in the first quarter of 2025. After joining the S&P 500 last quarter, it now shows the largest positive ownership gap among large-cap tech stocks at +1.58%.Overall, the note suggests active managers remain selective within technology, favouring hardware leverage to AI over broad megacap exposure — even as index concentration continues to climb. ---Persistent under-ownership in megacaps could fuel catch-up buying if performance continues. Conversely, crowded positioning in AI hardware names raises the risk of sharper pullbacks if sentiment shifts. This article was written by Eamonn Sheridan at investinglive.com.

Korean stocks hit a record high on tech strength, with a Kosdaq sidecar briefly triggered.Summary:KOSPI surged 2.46% to a record 5,642, breaking above 5,600 for the first timeTech stocks led gains, with Samsung Electronics up 4.0%Kosdaq programme trading was briefly halted after sidecar activationForeign investors were net sellers despite the rallyWon weakened while benchmark bond yields fellSouth Korean shares rallied to a fresh record high on Thursday, with the benchmark KOSPI rising 2.46% to 5,642.37, surpassing the 5,600 mark for the first time. The advance came as markets reopened following a three-day holiday break, with investor sentiment lifted by a strong rebound in US technology stocks overnight.Heavyweight semiconductor names drove the gains. Samsung Electronics jumped 4.03%, while SK Hynix added 1.48%, reflecting renewed optimism in the global chip cycle. Battery maker LG Energy Solution rose 1.77%, while industrial and auto names also participated in the rally. Hyundai Motor gained 0.40% and Kia climbed 2.32%, while POSCO Holdings advanced nearly 4%. Market breadth was positive, with 583 of 927 traded issues rising.The rally was strong enough to trigger a volatility control mechanism in the junior Kosdaq market. Programme trading was halted for five minutes after the Kosdaq 150 futures contract surged 6%, activating the Korea Exchange’s “sidecar” rule.Sidebar: What is the Korea sidecar rule? The sidecar is a temporary volatility control mechanism designed to curb excessive swings in derivatives-linked markets. It is triggered when Kospi 200 or Kosdaq 150 futures move sharply, typically by 5–6%, within a short period. When activated, programme trading (computer-driven arbitrage linked to futures) is suspended for five minutes. The rule does not halt all trading, but it slows algorithmic flows that can amplify momentum, helping stabilise the market during rapid moves.Despite the equity surge, foreign investors were net sellers, offloading shares worth 485.6 billion won. The Korean won weakened against the US dollar, while bond markets firmed. Three-year treasury futures rose and benchmark yields fell, with the 10-year yield down nearly 4 basis points.The KOSPI is now up nearly 34% year-to-date, highlighting strong momentum in Korean equities even as currency weakness persists. This article was written by Eamonn Sheridan at investinglive.com.

CBS says the US military is ready for possible Iran strikes as soon as Saturday, but Trump has not decided.Summary:CBS reports senior officials say the US military is ready for potential Iran strikes as soon as Saturday Trump has not made a final decision; discussions are described as fluid and ongoing Pentagon is moving some personnel out of the Middle East over the next three days as a precaution CBS says the shift is standard practice and does not necessarily mean an attack is imminent Rubio is expected to meet Netanyahu on Feb. 28, per officials (AP), amid ongoing Iran deliberationsA potential US military strike on Iran could come as soon as Saturday, according to CBS News, which cited sources familiar with internal discussions saying senior national security officials have told President Donald Trump the military is ready to act. The report stresses that Trump has not yet made a final decision, and that deliberations inside the White House remain fluid as officials weigh escalation risks against the political and military costs of restraint. As part of preparations, CBS says the Pentagon is moving some personnel temporarily out of the Middle East region over the next three days, primarily to Europe or back to the United States, positioning the move as a precaution in the event of action or potential Iranian counterattacks if the US proceeds. One source told CBS that such shifts are standard practice ahead of potential military activity and do not necessarily indicate an attack is imminent. A Pentagon spokesperson, contacted by CBS, said there was no information to provide. CBS also reports that the White House continues to publicly foreground diplomacy even as military planning advances. Press Secretary Karoline Leavitt said there are “many reasons and arguments” for a strike but described diplomacy as the president’s first option, while declining to discuss whether any operation would be coordinated with Israel. On the regional posture, CBS says US force deployments are expected to be in place by mid-March, with the USS Abraham Lincoln carrier group already in the region and the USS Gerald R. Ford carrier group en route. The report also notes Iran and the US held mediated talks in Geneva on Iran’s nuclear program, with the administration indicating progress but saying major gaps remain and no follow-up date has been set. Separately, AP reports Secretary of State Marco Rubio is expected to meet Israeli Prime Minister Benjamin Netanyahu on Feb. 28 to brief him on US-Iran talks, as Washington weighs next steps and continues to surge military resources to the region. This article was written by Eamonn Sheridan at investinglive.com.

Japan’s machinery orders rebound sharply, reinforcing capex strength despite fiscal caution.Summary:Core machinery orders surged 19.1% m/m in December vs 4.5% expectedAnnual growth jumped to 16.8% y/y vs 3.9% forecastRebound follows sharp November declinesData support the BOJ’s outlook for continued economic expansionCorporate survey (report earlier) shows ongoing fiscal caution despite strong capex signalJapan’s core machinery orders delivered a powerful upside surprise in December, underscoring renewed momentum in business investment and offering support to the Bank of Japan’s constructive growth outlook.Core machinery orders, a volatile but closely watched leading indicator of capital expenditure, surged 19.1% month-on-month, far exceeding expectations for a 4.5% rise. On an annual basis, orders climbed 16.8%, again well above forecasts for a 3.9% increase. The strength marks a sharp reversal from November, when orders had slumped 11% on the month and fallen 6.4% year-on-year.The scale of the rebound suggests November’s weakness was more a reflection of volatility than a meaningful deterioration in investment appetite. Machinery orders are often lumpy, but the magnitude of December’s rise points to solid underlying corporate demand. The data bode well for production and output in the months ahead, reinforcing expectations that Japan’s economy will continue expanding in line with the BOJ’s projections.The strong capex signal also comes against a backdrop of equity market strength. Japanese stocks have been rallying amid expectations of expansionary fiscal policies under Prime Minister Sanae Takaichi, while government bond yields have edged higher on speculation of increased debt issuance.However, the upbeat machinery data contrast with a more cautious tone in broader corporate sentiment. A recent Reuters survey showed two-thirds of Japanese firms remain concerned about fiscal discipline under the current administration. While worries about tensions with China have eased compared with the previous month’s poll, they remain a lingering source of uncertainty for some companies.Overall, December’s machinery orders point to resilient business investment momentum, even as fiscal and geopolitical concerns continue to shape the broader corporate outlook. This article was written by Eamonn Sheridan at investinglive.com.

RBNZ sees the cutting cycle as done, but weak consumption and sticky inflation keep risks two-sided.Summary:RBNZ’s Silk says the central scenario is the easing cycle is over, with risks both waysDownside risk: weak consumption and a softer household recoveryUpside risk: sticky inflation, meaning tightening remains possible if pressures persistRBNZ says policy needs to stay accommodative for some time to support recovery Even with a small hike, Silk notes rates would only be near the lower end of neutralNew Zealand’s central bank is framing policy as “cuts are done, but the outlook is two-sided,” after holding the Official Cash Rate at 2.25% and signalling that settings will remain accommodative for some time as the economy recovers. In comments following the decision, RBNZ Assistant Governor Karen Silk said the central scenario is that the easing cycle is over, but stressed risks sit on either side of that baseline. The downside risk is that consumption remains weak and the household recovery fails to build momentum, which would argue for keeping policy supportive for longer. The upside risk is that inflation proves sticky, requiring the Bank to lean against price pressures sooner than markets might expect.Silk’s framing reinforces the message embedded in the RBNZ decision: the policy stance is still accommodative, and officials see value in keeping the OCR track “where it is” to ensure the economy continues closing the output gap. That language is designed to avoid a premature tightening in financial conditions while the recovery remains uneven. At the same time, the Bank is explicitly reminding markets that “accommodative” does not mean “cut-biased.” Reuters reporting around the meeting notes the RBNZ’s projection track implies some possibility of a hike by year-end, even as the Governor emphasised the Bank is not planning to raise rates until it sees stronger inflationary pressure alongside a firmer economy. Silk’s point that even a small hike would only take rates toward the bottom end of neutral is important context: it suggests the Bank views any future tightening, if needed, as incremental and aimed at preventing inflation persistence rather than choking off growth.She also flagged that planned monthly CPI figures next year should complement the existing data set but could be volatile — a reminder that high-frequency inflation reads may introduce more noise around the “sticky vs fading” inflation debate. This article was written by Eamonn Sheridan at investinglive.com.

The January Federal Open Market Committee (FOMC) minutes quietly remove December’s “2% in 2028” timing, underscoring uncertainty.Summary:January minutes drop the explicit “2% by 2028” timing that appeared in DecemberStaff now say inflation is “slightly higher, on balance” than the December forecast Tariff effects are expected to wane around mid-year, with inflation then returning to a “previous disinflationary trend” December minutes explicitly said inflation would “reach 2 percent in 2028” The omission is a subtle signal of greater uncertainty (or less confidence) around the timing of the final glidepath to 2%One of the more revealing lines in the Fed’s January meeting minutes is not a line at all — it’s an omission. The Wall Street Journal's Nick Timiraos noticed the omission:In the December minutes, the staff forecast narrative was unusually specific about the long-run glidepath for inflation. Staff said tariff increases were expected to keep upward pressure on inflation through 2025 and 2026, before inflation returned to its prior disinflationary trend and “reach 2 percent in 2028.” That explicit date mattered: it anchored the staff’s baseline that the “last mile” back to 2% would be slow, but still achievable on a definable horizon.In the January minutes, the staff’s inflation story shifts subtly. Staff now describe the inflation forecast as “slightly higher, on balance” than the one prepared for December, reflecting tighter resource utilisation and a higher projected path for core import prices. They again lean on tariffs as a key near-term driver, noting that as the effects of higher tariffs are expected to wane starting around the middle of the year, inflation is projected to return to its “previous disinflationary trend.” But the December clause , the explicit endpoint of reaching 2% in 2028, does not appear.Why does that matter? Minutes are carefully edited documents, and the staff forecast paragraph is typically one of the more consistent sections across meetings. When a specific date drops out, it can be read as the Fed becoming less willing to pin the outlook to a calendar, especially at a time when uncertainty is described as “elevated” and risks to inflation are still seen as skewed to the upside. This does not necessarily mean the staff have abandoned the 2% objective or even that the endpoint has shifted again. But it does suggest a preference to emphasise direction (“back to disinflation”) over deadline (“2% by X”). For markets, that kind of nuance can feed the idea that the Fed is increasingly cautious about declaring victory on the inflation path, and wary of being boxed in by its own timetable if the next phase of disinflation proves “slower and more uneven.” This article was written by Eamonn Sheridan at investinglive.com.