ING’s Chris Turner argues that EUR/USD remains under pressure as investors position for further Middle East escalation and tighter global financial conditions. He notes that Sovereign Wealth Fund retrenchment and hawkish European Central Bank pricing weigh on the pair.

The US Dollar (USD) keeps marching higher against the Canadian Dollar (CAD) on Friday.

Nordea’s Jan von Gerich observes that recent equity weakness has not produced a stronger Dollar, suggesting its traditional safe-haven role is less dominant than before.

Scotiabank strategists Shaun Osborne and Eric Theoret highlight that the Canadian Dollar (CAD) is steady to slightly firmer versus the Dollar despite weak risk appetite, helped by a modest bid for commodity currencies.

Halpenny stresses that the extension of Trump’s pause only on attacks against energy assets, combined with Iran’s limited tanker gestures, suggests the Strait of Hormuz will stay constrained.

Brown Brothers Harriman’s (BBH) Elias Haddad highlights that global risk sentiment is deteriorating as Oil rises, equities and bonds fall, and the Dollar strengthens.

Commerzbank’s Dr. Vincent Stamer updates Euro area inflation projections incorporating the Iran War and associated energy shock. The bank expects higher Oil and natural gas prices to push headline inflation above 3% in 2026 before easing back to the ECB’s 2% target by 2027.

GBP/JPY trades flat on Friday after slipping earlier in the European session, as the Japanese Yen (JPY) strengthened amid rising intervention fears. The move comes as USD/JPY trades within striking distance of the 160.00 level, a key zone that previously prompted action from Japanese authorities.

ING’s Chris Turner notes that Banxico’s 25 bp rate cut to 6.75% came with largely unchanged inflation forecasts and a projection of a return to target in early 2027.

Scotiabank strategists Shaun Osborne and Eric Theoret report EUR/USD has slipped slightly below yesterday’s low as Dollar strength persists. ECB data show moderating inflation expectations, while President Lagarde signaled caution on rate moves given energy-price risks.

Silver (XAG/USD) trades around $68.50 on Friday at the time of writing, up 0.59% on the day, supported by renewed investor interest. Despite this uptick, the white metal remains within a broadly sideways trend, as market participants stay cautious amid an uncertain macroeconomic environment.

Royal Bank of Canada (RBC) economists Claire Fan and Abbey Xu expect Canadian GDP to be essentially flat in January after December’s 0.2% gain, with weakness concentrated in autos and housing but offset by energy and retail.

Thu Lan Nguyen at Commerzbank has revised Gold forecasts higher, now seeing USD 5,000 per ounce by end-2026 and USD 5,200 next year, despite a recent 15% drop.

ING notes that ECB officials have offered little resistance to hawkish market pricing as Oil rises, reinforcing front-end EUR rate expectations.

EUR/USD edges higher on Friday after early weakness, as the US Dollar (USD) pulls back from intraday highs, offering some support to the Euro (EUR). At the time of writing, the pair trades around 1.1545, recovering from a daily low at 1.1501.

Federal Reserve (Fed) Richmond President Thomas Barkin said on Friday that it is prudent to keep interest rates steady for now, as policymakers await greater clarity on the economic outlook.

Gold (XAU/USD) edges higher on Friday, rebounding after falling nearly 2.75% the previous day, as evolving geopolitical headlines around the US-Israel war with Iran continue to drive volatility across global markets. At the time of writing, XAU/USD is trading around $4,527, up over 3.00% on the day.

West Texas Intermediate (WTI) US Oil rises sharply and trades around $96.00 at the time of writing on Friday, up 3.55% on the day.

The British Pound (GBP) holds firm during the North American session on Friday, clings above the 1.3300 figure, yet seems poised to finish the week with 0.20% losses against the US Dollar (USD).

Standard Chartered’s Dan Pan and Erwin He note that Banxico’s surprise 25 bps cut and guidance for another easing step have increased downside risks for the Mexican Peso (MXN). They highlight crowded MXN long positioning and a narrower carry advantage versus other EM high-yielders.