EUR/GBP Remains Silent Near 0.8300 Ahead of Key Data Release From Eurozone, UK

GBP/USD remains above 1.2650 near two-month highs

GBP/USD edged lower after hitting a two-month high of 1.2674 on Friday, trading around 1.2670 at the time of writing during the Asian session. However, the pair gained ground as the US Dollar (USD) struggled amid weak jobless claims data and mixed signals from the Federal Reserve (Fed).

US Initial Jobless Claims for the week ending February 14 increased to 219,000, surpassing the expected 215,000. Continuing Jobless Claims also rose slightly to 1.869 million, just under the forecast of 1.87 million. Read more...

GBP/USD rises above 1.2600 on weak US jobs data

The Pound Sterling (GBP) climbs against the US Dollar (USD) and crosses the 1.2600 figure on Thursday, with traders awaiting the release of United Kingdom (UK) Retail Sales data. Meanwhile, a soft United States (US) jobs report weakened the US Dollar. The GBP/USD pair trades at 1.2616, up 0.25%.

The Cable failed to rally on Wednesday as inflation rose above 3% in January, weakening the case for further interest rate cuts by the Bank of England (BoE). Meanwhile, US President Donald Trump's tariffs rhetoric continues. 

Source: FXSTREET

The USD/CHF pair recovers some lost ground around 0.8985 amid a modest rebound in US Dollar (USD) during the early European session on Friday. Investors brace for the preliminary US S&P Global PMI reports, which will be released later on Friday. Also, the Federal Reserve’s (Fed) Mary Daly and Philip Jefferson are set to speak later on the same day. 

Fed officials in January agreed they would need to see inflation ease more before lowering interest rates further. Policymakers are concerned about the impact Trump’s tariffs would have in making that happen, according to meeting minutes released Wednesday.

Fed Chair Jerome Powell said the bank was not "in a hurry" to cut the interest rate further, given significant uncertainty about where the economy might be headed. Analysts anticipate the US central bank will likely reduce its benchmark interest rate only once in 2025, with a big chance of no rate cuts at all. This, in turn, could lift the USD against the Swiss Franc (CHF).

Trump said on Wednesday he will announce new tariffs within the next month, adding lumber and forest products to previously announced plans to impose duties on imported cars, semiconductors and pharmaceuticals. Additionally, hopes for a ceasefire between Russia and Ukraine seem to have faded in the wake of intensifying Ukrainian drone attacks on Russian Oil pumping stations. Concerns about US President Donald Trump’s trade tariffs and ongoing geopolitical tensions should lend support to the safe-haven currency like CHF. 

Source: FXSTREET

AUD/JPY gains positive traction amid the emergence of heavy JPY selling on Friday.

The intraday momentum stalls near the top end of a one-week-old descending channel. 

A sustained strength beyond the said barrier should pave the way for additional gains.

The AUD/JPY cross builds on the previous day's late bounce from the 95.35-95.30 area, or over a one-week low, and gains strong positive traction during the Asian session on Friday. Spot prices, however, struggle to capitalize on the move beyond mid-96.00 and retreat to the 96.15 region in the last hour, still up for the first time in three days. 

The Japanese Yen (JPY) weakened after Bank of Japan (BoJ) Governor Kazuo Ueda signaled a potential bond market intervention to curb any further rise in the Japanese government bond (JGB) yields. Apart from this, the Reserve Bank of Australia's (RBA) cautious rate cut earlier this week continues to underpin the Aussie and offers additional support to the AUD/JPY cross. That said, expectations of continued BoJ rate hikes, bolstered by Japan's strong National CPI, help limit the JPY losses and cap the currency pair. 

From a technical perspective, the sharp intraday move-up stalls near a resistance marked by the top end of over a one-week-old descending trend channel. The said barrier is pegged near the 96.45-96.50 area and should now act as a pivotal point. Some follow-through buying could lift the AUD/JPY cross to the 200 period Simple Moving Average (SMA) on the 4-hour chart, around the 97.00 neighborhood. This is followed by last week's swing high, around the 97.30-97.35 area, which if cleared should pave the way for additional gains. 

The AUD/JPY cross might then resume its recent goodish recovery move from the lowest level since September 2024 touched earlier this month and aim towards reclaiming the 98.00 mark. The momentum could extend further towards the next relevant hurdle near the mid-98.00s en route to the 98.75-98.80 supply zone and year-to-date peak, around the 99.10-99.15 region touched in January. 

On the flip side, the 95.70 area now seems to protect the immediate downside ahead of the overnight swing low, around the 95.35-95.30 region, and the 95.00 psychological mark. A convincing break below the latter would be seen as a fresh trigger for bearish traders and make the AUD/JPY cross vulnerable to retesting the multi-month low, around the 94.40-94.35 region before dropping to the 94.00 round-figure mark.

AUD/JPY 4-hour chart

Source: FXSTREET

China’s distressed developers are increasingly asking local courts to drive their restructuring efforts, as weak home sales continue to weaken their ability to make headway or deliver on private debt workout plans. 

Chongqing Casin Property Development Group Co late last month became the newest among its peers to apply for the court to overhaul its debt. The move followed a Bloomberg News’ report that defaulter China Fortune Land Development Co is considering scrapping a creditor-approved debt plan for a court-led solution. 

Meantime, Jinke Property Group Co, the country’s first high-profile, listed delinquent builder to pursue this option, started a creditor vote on its relevant restructuring proposal earlier this week. The vote will end on March 31. 

The expanding list of Chinese developers seeking the court’s help is the latest sign of stress in a property debt crisis that’s entering its fifth year, as private debt talks become protracted and existing restructuring efforts suffer setbacks. While a court-driven process does present an alternative path for distressed firms, its success hinges on key factors including the introduction of cash-rich new investors.

“Court-led restructuring is the last resort for distressed companies,” said Qian Wenhan, a partner of Zhong Yin Law Firm, who specialises in restructuring and bankruptcies. “As China’s housing market has yet to notably stabilise, and some companies’ debt negotiations become lengthy or even hit an impasse, more developers are expected to use this approach to solve their predicament.”

The trend is also evident across industries as a slowdown in the world’s second-largest economy takes its toll. The number of Chinese listed companies seeking court-led restructuring rose to a six-year high of 29 last year, according to a report by Shanghai-based AllBright Law Offices. Nearly a quarter of them were from real estate or construction firms, it shows.

Court-supervised restructuring for developers in China remains a novelty, despite a record wave of defaults in the industry over recent years. Such an approach generally requires a procedure to place the company under bankruptcy administration, and may include white knights to bring in new funds. 

A growing number of Chinese developers also have ended up in court in Hong Kong since the crisis began, although it was predominantly the offshore creditors that applied to liquidate the defaulters’ business. At least seven such builders, including former industry behemoth China Evergrande Group, has received the court’s so-called winding-up rulings. 

To be sure, whether a local court will agree to drive a company’s restructuring depends on key conditions such as securing strategic investors who can inject new life into the debt-laden firm, lawyers and analysts say. 

While the sample pool in China remains too small to meaningfully analyse the impact of court-led restructuring on creditors and investors, the prolonged nature of the debt crisis has lowered the expectations for some. 

“Holders of public bonds can otherwise only live to see corporate assets depreciate over time,” said Ma Suiqing, a senior partner and fixed income investment director at Tensor Pacific Co, a Hangzhou-based hedge fund. “That’s why court-led restructuring of developers is clearly beneficial to most bondholders, as it at least offers some level of transparency and fairness.”

Source: Theedgemarkets