RatePulse Market

NZD

✅RBNZ on Holding Rates
✅Inflation up to 3.1% (a bit stagflation)
✅ Unemployment rate up to 5.4%
🚫No Geopolitic Turmoil

Bias Neutral

WEEK STARTING 8TH FEB 2026

Trump to announce New FED chair. Kevin Warsh likely to be announced.

But does this settle Global Tension. Tariffs, US- IRAN issue, Greenland issue.

SELL THE RUMOUR, BUY THE FACT.

USD SELL-OFF EXPLAINED

https://youtu.be/TgNdagkzO-A

EUR
Dominant Macro Constraint: Labor/Growth (uneven regional recovery with services weakness offsetting manufacturing gains).

Current Market Narrative: EUR supported by ECB's cautious hold amid policy divergence from Fed, though growth fragilities cap gains.

Interest Rate Expectations:
Stable, with minimal shifts as ECB signals end of easing cycle.
Market pricing ~1bp cut by end-2026 (no change at Feb 5 meeting), later cuts if inflation undershoots.

Top 2 Data Releases This Week: Unemployment Rate (Jan 30)

Conditional Bias:
Bullish IF inflation holds firm, supporting ECB hold.
Bearish IF growth data weakens, prompting dovish bets.
Neutral IF expectations remain unchanged.

Classification: Strong (hawkish hold vs Fed's dovish tilt creates positive differentials).

Summary:
Stable ECB expectations bolster EUR vs dovish Fed repricing, favoring upside in crosses.
Minimal cut pricing limits downside, with hawkish stability enhancing appeal if US data softens.
Divergence-driven strength persists unless growth misses shift ECB toward dovish.

USD
Dominant Macro Constraint: Inflation (sticky core pressures amid resilient growth, compounded by fiscal stimulus and trade policy uncertainties). Labor sector is show some improvement hence limiting Rate cuts.

Current Market Narrative: USD facing downward pressure from expected Fed easing cycle and geopolitical intervention speculation (e.g., vs JPY), though resilient US data limits sharp declines.

Interest Rate Expectations:
Shifting more dovish as markets price in gradual easing amid softening labor signals.
Market pricing ~54bps of cuts by end-2026, with first cut potentially in March (no change expected at Jan 28 FOMC).

Top 2 Data Releases This Week: CB Consumer Confidence (Jan 27), FOMC Press Conference (Jan 28).

Conditional Bias:
Bullish IF data surprises strong, reinforcing hold on rates.
Bearish IF data misses, accelerating dovish repricing.
Neutral IF expectations remain unchanged.

Classification: Weak (dovish differentials vs hawkish non-US peers like BoJ and RBA).

Summary:
Expectations for dovish Fed path undermine USD support, favoring weakness vs high-yield peers.
Dovish repricing risks intensify if data softens, capping upside amid stable-to-hawkish global shifts.
Neutral hold at FOMC reinforces divergence, pressuring USD unless labor resilience shifts hawkish.

I will not be surprised to see GBP weak across the board....

Fiscal policy is always crazy...

USD is facing uncertainty.
JPY is facing Geopolitical tension .

Gold might hit 7k soon...

US government shutdown is nearing....

Here is another fundamental outlook....

S&P 500 is about to skyrocket 🚀🚀

Watch out carefully....

Fundamentals and understanding Context will give you direction,
But
NOT Timing

WEEK AHEAD Jan 19

US economic data will come in thick and fast as agencies work through releases delayed by the government shutdown. Key attention will be on personal income and spending, including the PCE inflation gauges, alongside another reading of Q3 GDP. Forward-looking data will also be in focus, with S&P PMIs and the University of Michigan consumer sentiment survey. PMI reports are also due from the Eurozone, UK, Japan, Australia, and India. Meanwhile, the UK will publish inflation, jobs data, and retail sales. In Asia, markets will watch China’s final GDP figure for the year and the Bank of Japan’s monetary policy decision. On the corporate side, earnings are expected from Netflix, 3M, Johnson & Johnson, Visa, Intel, Procter & Gamble, and NextEra Energy.