Investors and forex traders are preparing for the release of U.S. inflation data at 15:30 (GMT+2). According to forecasts, the January figure remained at 0.3% month-on-month and slowed from 2.7% to 2.5% year-on-year, reflecting rising food and energy prices. Core inflation is expected to increase from 0.2% to 0.3% month-on-month and ease from 2.6% to 2.5% year-on-year, remaining above the Federal Reserve’s 2.0% target due to the traditional post-holiday repricing of retail goods. Confirmation of this trend, alongside a stabilizing labor market—marked by a decline in unemployment from 4.4% to 4.3% and an increase in nonfarm payrolls to 130,000 from 66,000—could prompt the Fed to pause further rate adjustments at least until mid-year. Meanwhile, Fed Board member Stephen Miran, opposing the majority view, stated today that current monetary policy is overly restrictive and threatens the U.S. economic recovery, calling for a return to a more dovish stance to support employment while downplaying inflation risks.

Eurozone

The euro is strengthening against the yen, weakening versus the U.S. dollar, and showing mixed performance against the pound.

Investors are focused on eurozone GDP data: in the fourth quarter, output grew by 0.3% quarter-on-quarter and 1.3% year-on-year, down from 1.4% previously. Analysts note that the figures met expectations and project full-year growth of around 1.25%. Traders are also looking for signs of recovery in Germany’s economy, which is slowly emerging from crisis. December foreign trade data showed turnover reaching €12.6 billion, above expectations of €11.8 billion. However, analysts anticipate further slowing due to U.S. import tariffs and China’s trade expansion. Germany’s trade deficit with China widened from €24.5 billion to €26.8 billion last year, an increase of about 15%. Meanwhile, Germany’s producer price index rose by 0.9% month-on-month versus forecasts of 0.1%, while remaining at 1.2% year-on-year.

United Kingdom

The pound is strengthening against the yen and shows mixed dynamics versus the euro and the U.S. dollar.

According to the Financial Times, Prime Minister Keir Starmer plans to propose a multinational defense initiative to European partners to coordinate joint arms procurement, aiming to reduce costs. The initiative could support industry—particularly the defense sector—and accelerate financial recovery among partners. Meanwhile, UK GDP growth in the fourth quarter came in at a weak 0.1%, underscoring the need for economic stimulus. Based on incoming macro data, analysts believe the Bank of England may continue easing monetary policy as early as March.

Japan

The yen is weakening against the euro, the pound, and the U.S. dollar.

Today, Bank of Japan board member Naoki Tamura said inflation is approaching the central bank’s 2.0% target. He noted that interest rates remain far from neutral and suggested that several more policy tightenings could occur in the medium term before borrowing costs begin to weigh on GDP growth. Following these comments, investors estimate an 80% probability of a return to hawkish rhetoric in April. Meanwhile, Prime Minister Sanae Takaichi is scheduled to meet BOJ Governor Kazuo Ueda on Monday, likely to discuss coordination between monetary and fiscal policy to support the economic recovery.

Australia

The Australian dollar is weakening against the euro, the pound, and the U.S. dollar, while showing mixed performance versus the yen.

Investors are focused on comments from Reserve Bank of Australia board member Sarah Hunter, who said she expects labor market stability and inflation to remain above the 2.0–3.0% target range for an extended period. She added that the RBA is monitoring the impact of policy measures on the economy and employment. Minutes from the latest RBA meeting are due next week, with traders hoping for clues on future policy steps. Currently, most analysts put the probability of a rate hike in May at 75%.

Oil

Oil prices continue to decline amid reports of a potential increase in crude output by OPEC+ countries starting in April. Producers believe demand for crude will rise significantly by summer, while escalating U.S.–Iran tensions could provide some support and potentially escalate into direct military conflict. The next OPEC+ meeting is scheduled for March 1. Previously, the group adjusted production quotas from April to December 2025 by around 2.9 million barrels per day, or roughly 3% of global demand, though increases planned for January–March were postponed due to seasonal demand weakness.