26/02/2026 - 08:28 UTCThe USDX moved 0.25% lower on Wednesday, as the Greenback faces ongoing pressure from uncertainty surrounding the White House’s trade and economic strategies. This decline was further fueled by a cautiously dovish tone from IMF Managing Director Kristalina Georgieva, who suggested that reducing the federal funds rate toward a 3.25%–3.50% range would support a return to full employment, particularly as tariff-driven costs begin to impact goods inflation. In Tuesday’s State of the Union, President Trump stood firm on trade, insisting that tariffs are necessary for economic growth. After the Supreme Court blocked his previous plan, the administration switched to a different law (Section 122) to keep a 10% tax on imports for now.
However, investors are uncertain about the future of these taxes because this specific law only allows them to last for 150 days unless Congress decides to step in and extend them. Despite these headwinds, the USDX finds some support from Federal Reserve officials who remain wary of near-term easing. Chicago Fed President Austan Goolsbee noted that inflation progress has stalled, with current levels still significantly above the 2% target, while Boston Fed President Susan Collins emphasized that a resilient labor market justifies maintaining current interest rates for the time being.
General Asia news was headlined by the Bank of Korea’s decision to maintain interest rates while upgrading its economic growth outlook. This optimism, coupled with Nvidia's record Q4 revenue of $68.1 billion, propelled the South Korean index to a record high above 6,200. However, regional sentiment was cautious as S&P 500 futures dipped slightly, reflecting some investor hesitation regarding Nvidia's future inventory levels and sales in the Chinese market. In China, the China SSE and China SZSE edged marginally higher, rising 0.03% and 0.25% respectively. Mainland markets paused for breath following a strong two-day post-holiday rally. While technology shares saw a modest rebound, the broader index was weighed down by declines in the new energy and metal sectors following reports of potential U.S. AI-driven mineral pricing policies.
The Japan 225 touched an intraday record high above 59,300 but retreated to trade -0.59% lower by 08:12 AM GMT. The early surge was fueled by the nomination of dovish BOJ board members, which cooled rate hike expectations and weakened the yen. However, profit-taking in heavyweight semiconductor-related stocks, such as Tokyo Electron and Advantest, dragged the index off its peaks as the market "priced in" the stellar Nvidia results.
The Hong Kong 50 was the region's clear underperformer, sliding -1.51%. The index was battered by persistent weakness in local technology names, as investors continue to worry about AI developments disrupting traditional software business models. Unlike the mainland's resilience, the index was unable to capitalize on the positive leads from Wall Street or the Lunar New Year spending optimism.
Wall Street surged on Wednesday as the main US equity indices rebounded from earlier tariff-driven volatility. Market sentiment was buoyed by easing fears of immediate AI-related disruptions, particularly after Meta’s multi-year deal with AMD and positive partnerships announced by the startup Anthropic. Investors remained focused on Nvidia, which served as the primary bellwether for the session. The semiconductor giant saw its stock rise 1.51% as the market anticipated its fiscal fourth-quarter results. In contrast, AMD shares fell -1.42%, retracing some of the previous session's gains despite the Meta deal. While the broader tech sector celebrated a two-day resurgence, the focus now shifts to whether Nvidia’s bumper revenue forecasts can sustain the global "AI trade" momentum into 2026.
The EUR/USD pair rebounded on Wednesday as the US Dollar lost upward momentum, allowing the single currency to recover from earlier intraday losses.
The Greenback has struggled to extend recent gains amid lingering structural headwinds linked to the trade approach of US President Donald Trump. Renewed uncertainty over US trade policy has weighed on investor confidence and revived concerns about policy credibility and fiscal stability.
Trade tensions flared again after Trump announced a 10% global tariff just hours following a ruling by the Supreme Court of the United States against his use of the International Emergency Economic Powers Act.
In response, the European Parliament paused the ratification process of last year’s US-EU trade agreement.
At the same time, reduced expectations for imminent rate cuts by the Federal Reserve have helped limit deeper losses in the US Dollar.
In the Eurozone, softer inflation data briefly pressured the euro earlier in the session. Final figures showed the Harmonized Index of Consumer Prices rising 1.7% year-on-year in January, down from 2.0% in December and marking the lowest reading in 16 months. Core inflation also eased to 2.2% from 2.3%.
Looking ahead, investors will focus on upcoming Eurozone sentiment indicators, including February Consumer Confidence and the Economic Sentiment Indicator. In the US, attention will turn to Producer Price Index data due on Friday, which could offer fresh clues on the inflation trajectory and monetary policy outlook.
Gold extended its advance for a second consecutive session on Thursday, climbing to a fresh daily high ahead of the European open as bulls sought to consolidate gains above the $5,200 threshold. The move keeps the precious metal within reach of its monthly peak, supported by persistent safe-haven demand.
Ongoing uncertainty surrounding trade policy under US President Donald Trump has continued to underpin the metal. The fluid nature of tariff policy has kept investors cautious, reinforcing demand for defensive assets such as gold.
Geopolitical risks have added another layer of support. Washington and Tehran are preparing for a third round of negotiations aimed at resolving their long-running nuclear dispute, amid heightened tensions and a significant US military buildup in the Middle East. In a recent State of the Union address, Trump reiterated his position that Iran must not acquire nuclear weapons, reviving concerns about potential escalation and further bolstering safe-haven flows into bullion.
A modest pullback in the US Dollar has also contributed to gold’s resilience. Although the Federal Reserve maintains a relatively hawkish stance, markets continue to price in the possibility of up to three 25-basis-point rate cuts this year. At the same time, fears of retaliatory trade measures and supply chain disruptions linked to US tariffs have kept the greenback on the defensive.
Oil prices were broadly steady in Asian trading on Thursday as investors awaited a pivotal third round of nuclear negotiations between Washington and Tehran, an event seen as critical for the near-term outlook.
US special envoy Steve Witkoff and Jared Kushner are scheduled to meet Iranian officials in Geneva later in the day, as Washington seeks progress on Tehran’s nuclear and ballistic missile programs. Iranian Foreign Minister Abbas Araqchi has indicated that a diplomatic breakthrough remains possible, provided both sides engage constructively.
US President Donald Trump has warned that “bad things” could happen if talks fail to deliver tangible results, keeping geopolitical risk firmly on the market’s radar.
Iran remains one of the larger producers within OPEC, and any disruption to its exports — particularly through the strategically vital Strait of Hormuz, a key artery for global oil shipments — would likely send prices higher.
On the supply front, fresh data from the U.S. Energy Information Administration showed a significant and unexpected rise in US crude stockpiles. Commercial inventories surged by 16 million barrels in the week ended February 20, marking the largest weekly increase in roughly three years and far exceeding market forecasts.
Gasoline inventories, however, declined by around 1 million barrels, while distillate stocks edged up by approximately 250,000 barrels. Refinery utilization rates fell during the period, contributing to the sharp headline build in crude inventories.
US equities closed firmly higher on Wednesday, led by gains in the technology sector, as investors positioned ahead of earnings from chip giant Nvidia after the closing bell. The rebound extended a recovery that began Tuesday following a sharp sell-off earlier in the week.
Wall Street’s advance came as investor concerns about the disruptive impact of artificial intelligence across multiple industries began to ease. Market participants appeared to welcome a renewed bid in large-cap technology stocks, reversing what some had feared could become a longer-term rotation out of the sector.
Sentiment was buoyed earlier in the week after Meta Platforms announced a multi-year partnership with Advanced Micro Devices, while AI firm Anthropic outlined a series of new collaborations. The developments helped calm worries about widespread disruption to software and data-related stocks stemming from the latest AI model launches.
Beyond corporate earnings, investors continued to monitor trade policy developments under US President Donald Trump. The administration recently imposed temporary 10% global tariffs following a ruling by the Supreme Court of the United States that struck down broader “reciprocal” levies.
In his State of the Union address on Tuesday, Trump defended his tariff strategy, stating that it was functioning effectively, while describing the court’s decision as “unfortunate.” He also addressed inflation, economic policy and ongoing diplomatic efforts with Iran.
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