IC Markets Global – Asia Fundamental Forecast | 13 February 2026
What happened in the U.S. session?
The U.S. session overnight featured resilient but elevated initial jobless claims (227K vs. 222K expected) and a steeper-than-forecast drop in existing home sales (3.91M, -8.4% MoM), alongside a well-received $25B 30-year bond auction that pushed yields lower to ~4.76%; these mixed signals reinforced a “higher for longer” Fed narrative, boosting U.S. equity futures (S&P +0.35%), supporting USD firmness versus EUR and JPY, and driving Treasury bond strength, while housing-sensitive assets faced pressure.
What does it mean for the Asia Session?
Asian markets hit records Thursday on US jobs data and Japan optimism, with MSCI Asia-Pacific up 0.65% and Nikkei surging post-election; the dollar dipped, yen rebounded 1.61% monthly, but overbought signals hint at pullbacks into Friday’s data. Traders eye USD/JPY volatility (151-159 range) and AUD strength from RBA hike spillovers.
The Dollar Index (DXY)
Key news events today
Core CPI m/m (1:30 pm GMT)
CPI m/m (1:30 pm GMT)
CPI y/y (1:30 pm GMT)
What can we expect from DXY today?
The US Dollar Index (DXY) is trading around 96.80-97.00, showing limited movement after stabilizing above 97 yesterday amid choppy trading. Stronger-than-expected January nonfarm payrolls data (130,000 jobs added, unemployment at 4.3%) provided support by scaling back near-term Fed rate cut bets, though markets still price in two cuts this year.
Central Bank Notes:
- The Federal Open Market Committee (FOMC) is widely expected to hold the federal funds rate target range steady at 3.50%–3.75% at its January 27–28, 2026, meeting, marking the second consecutive pause after three 25-basis-point cuts in late 2025.
- The Committee continues to pursue maximum employment and 2% inflation goals, with the labor market remaining soft as the unemployment rate stood at 4.4% in December 2025 amid modest job gains of 50,000.
- Officials note balanced risks to growth and employment alongside sticky inflation, with CPI at 2.7% year-over-year in December 2025 and core PCE at 2.8% due to tariffs and housing pressures; headline PCE at 2.6%.
- Economic activity expanded robustly at 4.4% annualized in Q3 2025, with Q4 estimates around 5% per Atlanta Fed GDPNow, supported by consumer spending despite prior trade tensions and shutdown effects.
- December 2025’s Summary of Economic Projections forecasts 2025 unemployment at a median of 4.5%, 2026 GDP growth at 2.3%, and core PCE at 2.5% (down from prior 2.6%), with the dot plot signaling one more cut in 2026; January updates may reflect resilient Q4 growth.
- The Committee maintained its data-dependent approach, noting a stable but soft labor market and inflation above target, while holding rates steady at 3.50%-3.75%; dissents likely persist amid divisions on the pace of easing.
- The FOMC continues its adjusted quantitative tightening post-December 1, 2025, conclusion of prior program, with Treasury rolloff caps at $5 billion per month and agency MBS at $35 billion per month to maintain ample reserves.
- The next meeting is scheduled for 17 to 18 March, 2026.
Next 24 Hours Bias
Medium Bearish
Gold (XAU)
Key news events today
Core CPI m/m (1:30 pm GMT)
CPI m/m (1:30 pm GMT)
CPI y/y (1:30 pm GMT)
What can we expect from Gold today?
Gold prices experienced a short-term decline, amid market volatility and ahead of key US economic data releases like CPI and unemployment claims, with spot gold dropping over 1% to around $5,032 per ounce. Analysts note XAU/USD remains in a consolidation phase near the $5,000-$5,100 range, showing sideways movement after struggling to break higher resistance, while silver also fell sharply below $81 per ounce.
Next 24 Hours Bias
Strong Bearish
The Australian Dollar (AUD)
Key news events today
No major news event
What can we expect from AUD today?
The AUD/USD pair continues its bullish run despite headwinds from China’s economic slowdown and domestic sentiment dips, trading near 0.7129 with strong yearly gains of over 12% reflecting resilience tied to commodity exports and global macro shifts, though Friday-specific developments remain unreported.
Central Bank Notes:
- The Reserve Bank of Australia (RBA) is widely expected to raise its cash rate by 25 basis points to 3.85% at the February 2-3, 2026 policy meeting, responding to persistently high inflation data from the December quarter. This would reverse the cautious pauses since the August 2025 cut, as two consecutive quarters of elevated inflation readings—following the September surprise—prompted upward revisions to forecasts. Policymakers have prepared markets for this move, viewing it as necessary despite temporary factors in prior data.
- Inflation vigilance remains paramount, with trimmed mean measures in the low 3s and unlikely to hit the 2–3% target midpoint before late 2026. Underlying pressures persist from services, housing, and capacity constraints, amplified by the shift to monthly CPI reporting since November 2025, which flagged broader pick-up risks. Forecasts now delay easing further amid sticky wage growth and softening but resilient labor market dynamics.
- Headline CPI exceeded expectations again in December, driven by core stickiness beyond one-off items like energy, while new monthly data enhances monitoring precision. Services and housing continue fueling resilience, with domestic demand firm despite below-trend goods growth.
- Labor market softening sees unemployment stabilizing near 4.4%, but unit labor costs linger as a concern amid subdued productivity. Household spending grapples with elevated borrowing costs, though private demand recovery adds to capacity pressures not easing soon.
- Global outlook features modestly higher growth projections offset by geopolitical risks and commodity swings; policy shifts to unambiguously restrictive post-hike. Data-dependence anchors decisions, balancing inflation control against employment amid household vulnerabilities.
- Post-hike, monetary policy enters restrictive territory to combat price stability risks, reaffirming the dual mandate of 2–3% inflation and full employment with data-responsive flexibility.
- Markets price in the February hike to 3.85%, with big four banks aligning (CBA, Westpac) and some like NAB eyeing further rises to 4.10% by mid-year if inflation persists. Monthly CPI will provide critical real-time signals for subsequent moves.
- Policy tightens to counter inflation persistence against household and global fragilities, upholding dual mandate commitments and adaptability to evolving risks.
- Consensus tilts toward the February hike, with limited further increases as base case unless inflation accelerates; monthly data remains pivotal for 2026 trajectory.
- The next meeting is on 16 to 17 March 2026.
Next 24 Hours Bias
Strong Bullish
The Kiwi Dollar (NZD)
Key news events today
No major news event
What can we expect from NZD today?
The NZD/USD traded higher near 0.6055-0.6067, buoyed by short-term momentum but weighed down by RBNZ’s reluctance for imminent hikes amid mixed jobs data and global caution ahead of US inflation figures; the pair remains up significantly YTD but faces resistance from rate cut risks and commodity ties.
Central Bank Notes:
- The Monetary Policy Committee (MPC) left the Official Cash Rate (OCR) unchanged at 2.25% at its 26 November 2025 meeting, following the widely anticipated 25-basis-point reduction from 2.50%, and signaled that policy is now firmly in stimulatory territory while keeping the option of further easing on the table if needed.
- The decision was again reached by consensus, with members judging that the cumulative 325 basis points of easing over the past year warranted a period of assessment, even as several emphasized a willingness to cut further should incoming data point to a more protracted downturn or renewed disinflationary pressures.
- Headline consumer price inflation is projected to hover near 3% in late 2025 before gradually easing toward the 2% midpoint of the 1–3% target band through 2026, supported by contained inflation expectations around 2.3% over the two-year horizon and an expected pickup in spare capacity.
- The MPC noted that domestic demand remains subdued but shows tentative signs of stabilisation, with softer household spending and construction only partially offset by improving services activity; nevertheless, policymakers still expect services inflation to ease as wage growth moderates and the labour market loosens further over the coming year.
- Financial conditions continue to ease as wholesale and retail borrowing rates reprice to the lower OCR, contributing to gradually rising mortgage approvals and improving housing-related sentiment, although broader business credit growth remains patchy and sensitive to uncertainty about the durability of the recovery.
- Recent data confirm that GDP momentum is weak but not deteriorating as sharply as earlier in 2025, with high-frequency indicators pointing to a shallow recovery from a low base and ongoing headwinds from elevated living costs and fragile confidence weighing on discretionary consumption and investment.
- The MPC reiterated that external risks remain skewed to the downside, particularly from softer Chinese demand and uncertainty around United States trade policy, but noted that a lower New Zealand dollar continues to provide some offset via improved export competitiveness and support for tradables inflation.
- Looking ahead to early 2026, the Committee maintained a mild easing bias, indicating that a further cut toward 2.00–2.10% cannot be ruled out if activity fails to gain traction or if inflation undershoots projections, but current forecasts envisage the OCR remaining near 2.25% for an extended period, provided inflation converges toward target and the recovery proceeds broadly as expected.
- The next meeting is on 18 February 2026.
Next 24 Hours Bias
Weak Bullish
The Japanese Yen (JPY)
Key news events today
No major news event
What can we expect from JPY today?
The Japanese Yen continues its upward momentum, trading near 153 against the USD after four straight daily gains, propelled by Prime Minister Sanae Takaichi’s election win and bets on prudent fiscal policies enabling BoJ tightening. No major economic data releases are scheduled for Japan today, keeping focus on intervention rhetoric and global risk sentiment, though holiday-thinned trading may limit volatility. Forecasts suggest USD/JPY could ease to 152 in 12 months.
Central Bank Notes:
- The Policy Board of the Bank of Japan meets on 22–23 January 2026, with markets fully expecting the short-term policy rate to remain at 0.75%, following the December 2025 hike, as the bank assesses the impact of prior tightening while emphasizing gradual, data-dependent adjustments.
- The BOJ will continue targeting the uncollateralized overnight call rate around 0.75% and signal that future rate hikes depend on the effects of recent increases on bank lending, corporate financing, and economic activity, with some policymakers eyeing a possible move as early as April.
- JGB purchase tapering proceeds on schedule, with outright purchases reduced by ¥400 billion per quarter through March 2026, then ¥200 billion per quarter from April to June 2026, aiming for around ¥2 trillion monthly in Q1 2027, with flexibility if market conditions worsen.
- Japan’s economy showed recovery signs after the Q3 2025 contraction, with Q4 2025 GDP growth estimated positively amid export strength, though business sentiment among manufacturers softened to a six-month low of +7 in January 2026 due to weaker overseas demand.
- Core consumer inflation (excluding fresh food) eased to 2.3% year-on-year in December 2025 Tokyo CPI, down from 2.8-3.0% peaks earlier, while core-core (excluding fresh food and energy) stood at 2.6%, both above the 2% target but with moderating cost pressures.
- Near-term input costs continue easing from faded import surges, but services inflation and steady wage gains with early 2026 negotiations targeting 5% hikes sustain price momentum; medium-term inflation expectations remain anchored above 2%, tilting upside risks.
- In the coming quarters, real growth may moderate below potential amid tighter conditions and yen weakness, but accommodative real rates, real wage gains, and fiscal support are poised to bolster private consumption and investment recovery.
- Medium-term, stabilizing overseas demand and tight labor markets should drive wage growth and keep core inflation gradually around or above 2%, allowing cautious rate normalization if financial conditions stay supportive.
- The next meeting is scheduled for April 2026.
Next 24 Hours Bias
Medium Bullish
Oil
Key news events today
No major news event
What can we expect from Oil today?
Oil prices have seen upward momentum in recent sessions, primarily driven by escalating US-Iran tensions, raising fears of supply disruptions in key regions like the Strait of Hormuz. Brent crude hovered around $69-$70 per barrel, with WTI nearing $65, supported by draws in floating storage and tighter physical markets despite swelling US inventories.
Next 24 Hours Bias
Weak Bullish
The post IC Markets Global – Asia Fundamental Forecast | 13 February 2026 first appeared on IC Markets | Official Blog.