Forex Today: Global tech selloff weighs on market mood
Here is what you need to know on Friday, June 26:
Markets cling to a cautious stance in the European morning on Friday as Asian stocks suffer heavy losses, pressured by the ongoing selloff in technology stocks. The economic calendar will not offer any high-impact data releases. Later in the American session, the University of Michigan will publish a revision to the June Consumer Sentiment Index data and several Federal Reserve (Fed) policymakers will be delivering speeches.
Surging chip costs and inflation fears seem to be prompting investors to reassess the sustainability of the AI-driven tech rally.
South Korea's KOSPI lost about 8% on Friday and Japan's Nikkei 225 Index was last seen down 4.5% on the day. Reflecting the risk-averse market atmosphere, Nasdaq Futures are down more than 1% in the early European session.
Meanwhile, the US Dollar (USD) Index holds steady slightly below 101.50 after posting marginal losses on Thursday. The US Bureau of Economic Analysis (BEA) reported that Personal Consumption Expenditures (PCE) Price Index rose 4.1% on a yearly basis in May following the 3.8% increase recorded in April. This reading came in line with the market expectation. Other data from the US showed that Durable Goods Orders declined by 4.5% on a monthly basis in May, and that there were 215K Initial Jobless Claims last week.
US Dollar Price This week
The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Australian Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.76% | -0.04% | 0.21% | 0.20% | 1.67% | 1.55% | 0.17% | |
| EUR | -0.76% | -0.79% | -0.46% | -0.51% | 0.96% | 0.74% | -0.58% | |
| GBP | 0.04% | 0.79% | 0.06% | 0.24% | 1.69% | 1.55% | 0.19% | |
| JPY | -0.21% | 0.46% | -0.06% | -0.07% | 1.42% | 1.30% | -0.12% | |
| CAD | -0.20% | 0.51% | -0.24% | 0.07% | 1.48% | 1.37% | -0.06% | |
| AUD | -1.67% | -0.96% | -1.69% | -1.42% | -1.48% | -0.15% | -1.48% | |
| NZD | -1.55% | -0.74% | -1.55% | -1.30% | -1.37% | 0.15% | -1.34% | |
| CHF | -0.17% | 0.58% | -0.19% | 0.12% | 0.06% | 1.48% | 1.34% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
Goolsbee flags services inflation risks, keeps Dollar bulls alert
Chicago President Fed President Austan Goolsbee delivered a moderately hawkish speech on Thursday, with a 7/10 FXS Speechtracker score slightly below the 7.3/10 historical average but still skewed toward inflation concern. The repeated emphasis that “inflation [is] going the wrong way,” particularly on the services side and core measures, underscored unease about persistence rather than one-off shocks, while caution on forward guidance and AI-driven demand highlighted a preference for data-dependent policy over long-horizon commitments. Overall, the focus on inflation as “clearly the problem” keeps rate-cut expectations in check and supports the Dollar on the margin.
The FXS Fed Sentiment Index rose by 1.05 points to 121.05, reinforcing that the broader Fed communication backdrop remains firmly in hawkish territory. This move, aligned with Goolsbee’s inflation-focused remarks, signals that despite some “glimmers of hope” on services, the Fed narrative still leans toward guarding against renewed price pressures rather than rushing to ease.
The data from Japan showed that the Tokyo Consumer Price Index rose by 1.7% on a yearly basis in June, compared to 1.4% in May. USD/JPY fluctuates in a narrow channel above 161.50 in the European morning on Friday.
EUR/USD registered small gains on Thursday and stabilized above 1.1350. The pair is having a difficult time gathering directional momentum in the early European session.
GBP/USD stays in a consolidation phase at around 1.3200 on Friday after gaining about 0.2% on Thursday.
Following Wednesday's sharp decline, Gold (XAU/USD) rebounded modestly on Thursday and closed in positive territory. XAU/USD struggles to preserve its recovery momentum on Friday and remains within a touching distance of $4,000.
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
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