Investors and forex traders remain focused on the February consumer price index data published earlier. On a monthly basis, CPI accelerated from 0.2% to 0.3%, while the annual figure stood at around 2.4%. The core indicator, which excludes food and energy prices, changed from 0.3% to 0.2% on a monthly basis and remained at 2.5% year-on-year. Overall inflation remains above the Federal Reserve’s 2.0% target, largely due to rising fuel and food costs, and still does not fully reflect the impact of the Middle East crisis. Over the past 12 days, gasoline prices in the US have increased by about 20.0%, which could accelerate inflation by at least another 1.0% by the end of the month and limit the Fed’s ability to maintain a dovish stance at the March 18 meeting. Analysts at The Goldman Sachs Group Inc. have therefore revised their forecasts and now expect interest rate cuts to begin in September and December rather than in June and September as previously projected, a factor that supports the US dollar. Meanwhile, the Republican administration has launched new trade investigations under Section 301 of the Trade Act of 1974 against China, Mexico, the EU and several other countries, potentially allowing the introduction of new tariffs if unfair trade practices are suspected. Officials openly state that this step aims to replace mandatory tariffs previously ruled illegal by the US Supreme Court.
Eurozone
The euro is weakening against the yen but is moderately strengthening against the pound and the US dollar.
Investors fear that disruptions in energy supplies and rising oil prices amid the prolonged Middle East crisis could trigger a significant economic slowdown in the eurozone, which still lacks substantial domestic energy reserves. Inflation risks are also becoming more pressing, with preliminary data showing consumer prices rising to 2.4% in February. This could encourage the European Central Bank (ECB) to start a dovish policy cycle earlier in order to support economic growth. Earlier comments from Bundesbank President Joachim Nagel and Banque de France Governor François Villeroy de Galhau hinted at such a scenario. Both acknowledged the economic risks associated with surging oil prices and pledged to respond quickly if inflationary pressure intensifies. On Friday at 12:00 (GMT+2), markets will focus on January industrial production data in the eurozone, which is expected to rise by 0.5% month-on-month after a 1.4% decline previously, and increase from 1.2% to 1.5% on an annual basis, potentially offering moderate support for the euro.
United Kingdom
The pound is weakening against the yen, strengthening moderately against the euro and showing mixed dynamics against the US dollar.
In the absence of major economic releases, price movements are mainly driven by external factors. Analysts at The Goldman Sachs Group Inc. have revised their forecasts for Bank of England rate cuts for the second time this month, citing inflation risks related to rising energy prices. They now expect three interest rate cuts of 25 basis points each in July, November and February 2027, whereas earlier projections suggested the easing cycle could start as soon as next month. If inflation accelerates further and economic conditions deteriorate, the Bank of England may ultimately deliver only one rate cut by the end of the year or even postpone policy easing entirely.
Japan
The yen is strengthening against the euro and the pound while showing mixed performance against the US dollar.
Market participants are analyzing reports from Reuters sources indicating that rising fuel prices, although introducing uncertainty into the macroeconomic outlook, may not only prevent the Bank of Japan from lowering borrowing costs but could even push it toward tightening policy. While a prolonged conflict could trigger a global economic slowdown affecting Japan as well, inflation currently remains close to the 2.0% target, which continues to be a priority for monetary authorities.
Australia
The Australian dollar is weakening against major peers including the euro, pound, yen and US dollar.
Data from the Melbourne Institute showed that its inflation indicator increased from 5.0% to 5.2% in March, remaining well above the Reserve Bank of Australia’s target range of 2.0–3.0%. This signals stronger price pressure and increases the likelihood of tighter monetary policy in the near term. Most analysts expect the regulator to keep the interest rate unchanged in March but raise it by 25 basis points to 4.00% at the May meeting, a scenario that investors currently estimate at roughly an 80.0% probability.
Oil
Oil prices are making moderate attempts to rise amid the ongoing blockade of the Strait of Hormuz, which has removed roughly 20.0% of global crude supply from the market.
Over the past 24 hours, forces of the Islamic Revolutionary Guard Corps reportedly attacked between three and five large vessels, effectively confirming control over the strategic waterway. Meanwhile, the International Energy Agency (IEA) announced that its 32 member states agreed to release around 400.0 million barrels from emergency reserves — the largest coordinated release since the 1973 oil embargo. The United States alone plans to supply about 172.0 million barrels. US Energy Secretary Chris Wright stated that shipments could begin as early as next week. Despite these announcements, oil prices have not yet corrected downward. Two main factors explain this reaction: first, geopolitical tensions in the Middle East remain high, limiting the impact of the IEA initiative; second, the scale of the planned release itself highlights the seriousness of the global energy supply shortage, which continues to support prices.
