Currency Weekly Review

Saturday, 12 September 2026

Currency — Week in Review

EUR/USD

EUR/USD closed the week at 1.1602, down -0.22%. The dollar found support from rising Fed rate-hike bets tied to hot August CPI and PPI readings, while the euro slipped after the ECB's own hike failed to keep pace with shifting US rate expectations. The move was modest and consistent with a week dominated by US rate repricing rather than any eurozone-specific shock.

USD/JPY

USD/JPY fell -1.35% to 153.5540, the yen's weakest dollar exposure among the majors this week even as broader dollar sentiment firmed. News flow pointed to the yen extending a rally and heading for its first two-week winning streak since May, with markets positioning ahead of Fed, ECB and BoJ meetings. The pair's decline stood out against the dollar's general strength elsewhere, underscoring yen-specific buying rather than broad dollar weakness.

GBP/USD

GBP/USD was essentially flat on the week, down just -0.02% to 1.3529. Sterling drew support from a surprise UK GDP beat, with the economy expanding 0.4% in July against expectations of no growth, but gains were capped as the dollar firmed on US inflation data. The net effect was a week of push-and-pull that left the pair little changed.

AUD/USD

AUD/USD slipped -0.63% to 0.7156. There was no Australia-specific catalyst in the available data; the move looks consistent with the broader dollar-strength theme driven by rising US rate-hike bets following hot CPI and PPI prints, which weighed on most dollar-bloc and commodity currencies this week.

USD/CAD

USD/CAD rose +0.33% to 1.3835. Reporting noted the Canadian dollar edged lower even as oil prices stayed above $100 a barrel, an unusual pairing since Canada's currency is typically supported by stronger crude; US inflation data and broad dollar firmness appear to have outweighed the oil tailwind this week.

USD/CHF

USD/CHF gained +0.71% to 0.8132, the largest move among the dollar-positive pairs this week. This is consistent with the broad dollar strength theme tied to rising Fed hike expectations, with the franc offering less resistance than the yen did over the period.

Central Bank & Rate-Differential Themes of the Week

The dominant theme was a rapid repricing of US rate expectations after hot August CPI and PPI data, with the 10-year Treasury yield reportedly breaking briefly above 5% for the first time since 2024 before settling at 4.97% for the week, up 19 basis points. Our own market data confirms that yield move, which fed directly into dollar strength against the Swiss franc and the Canadian dollar in particular. The ECB delivered a hike of its own during the week but the euro slipped anyway, suggesting the market judged the Fed's shifting path as the more consequential driver. The Bank of Japan was reportedly awaited alongside the Fed and ECB, with the yen extending its rally ahead of that meeting even as the dollar firmed elsewhere — a divergence worth watching into next week's central bank calendar.

Macro Context

⚠️ Energy markets were a major cross-current: WTI crude surged +9.37% on the week to $100.05 amid escalating Middle East conflict, including a Saudi shutdown of the East-West pipeline after drone attacks, with some reports citing prices reaching $105 a barrel intraday. Higher energy costs were cited as a factor keeping US inflation elevated, feeding the same CPI-driven dollar strength that moved currency markets. Equity markets broadly declined for the week — the S&P 500 down -0.80%, the Dow down -1.57%, and the FTSE 100 down -1.67% — while the VIX rose +9.02%, consistent with a more cautious risk backdrop that also weighed on commodity-linked currencies like the Australian and Canadian dollars.

What to Watch Next Week

• 📅 The Federal Reserve's policy meeting, widely flagged by market commentary as the next major test for both equities and the dollar.
• Bank of Japan policy signals following the yen's recent rally, with markets watching whether the trend extends to a two-week winning streak.
• Further developments in the Middle East conflict and their effect on oil prices, given crude's sharp weekly rise and its link to inflation expectations.
• Continued US inflation and rate-hike repricing following last week's CPI and PPI data, and its knock-on effect on Treasury yields and the dollar.
• The NYSE resumes normal trading Monday 14 September, with no scheduled market holiday in the next twelve days.

Currency Weekly Review is AI-generated general market commentary for informational purposes only. It is not financial advice and does not constitute a recommendation to buy, hold, or sell any security. Share and index prices are settled closes from the last completed market session, date-matched to the NYSE calendar. Any futures, extended-hours or crypto levels are live quotes at the time of writing. Nothing here is real-time.