Trusted by over 15 Million Traders
The Most Awarded Broker
for a Reason
CATEGORIES
News
- Can palm oil's rebound pass the "triple test"?
- The dollar continues to collapse! The euro takes the opportunity to rush to 1.16
- Mirroring history, the Federal Reserve may make smart choices now
- Gold broke through upwards, and fell back in early trading to follow the trend!
- U.S. crude prices fall as inventory decline fails to offset OPEC+ supply pressur
market news
A collection of good and bad news affecting the foreign exchange market
Wonderful introduction:
Green life is full of hope, beautiful fantasy, hope for the future, and the longed-for ideal is the green of life. The road we are going to take tomorrow is lush green, just like the grass in the wilderness, releasing the vitality of life.
Hello everyone, today XM Forex will bring you "[XM Group]: A collection of good and bad news affecting the foreign exchange market". Hope this helps you! The original content is as follows:
On February 5, 2026, the foreign exchange market was affected by the policy divergence of global central banks, disturbances in U.S. economic data, and the easing of the geopolitical situation. The long-short game intensified, the U.S. dollar index fluctuated and consolidated, and non-U.S. currencies showed a divergent trend. This article sorts out the core good and bad news that affected the foreign exchange market that day, and www.xmtraders.combined the currency pair linkage logic to provide trading references to help avoid volatility risks (it is only a summary of the news and does not constitute investment advice).
1. Core good news (good for non-US currencies, suppressing the US dollar)
European and British central banks kept interest rates unchanged, supporting European currencies. On February 5, the European Central Bank and the Bank of England announced interest rate decisions one after another, both maintaining the current interest rate levels unchanged, in line with market expectations. The European Central Bank continued its interest rate stabilization tone since June 2025 in response to the euro zone's January CPI falling to 1.7% year-on-year inflation. At the same time, it paid close attention to the impact of the depreciation of the U.S. dollar on exports and did not release further easing signals to provide support for the euro. The Bank of England has not yet started to cut interest rates, waiting for clear signals of slowing wage growth to ease the downward pressure on the pound. The euro against the US dollar and the pound against the US dollar received a short-term boost.
The strong appreciation of the RMB has led to the recovery of currencies in emerging markets. Supported by the liquidity support of the People's Bank of China and the resilience of economic recovery, the spot exchange rate of RMB against the US dollar rose above 6.94 on February 5, hitting a 32-month high, and the central parity rate of the US dollar against the RMB continued to decline. The central bank carried out 800 billion yuan of buyout reverse repos, increased credit support in the fields of technological innovation and domestic demand, and intensified high-level www.xmtraders.communication between China and the United States, which increased the attractiveness of RMB assets and indirectly led to the overall strengthening of emerging market currencies and weakened the downward pressure on the U.S. dollar index.
US-Iran negotiations resume, geopolitical risks reducedWarmth is good for risky currencies. After urgent lobbying by Middle East leaders, the United States resumed the U.S.-Iran nuclear negotiations originally scheduled for February 6. Concerns that the previous negotiations were on the verge of collapse have eased, and geo-risk premiums have fallen. Driven by the rebound in risk appetite, www.xmtraders.commodity currencies such as the Australian dollar and the New Zealand dollar stopped falling and recovered, easing the early downward pressure caused by the strengthening of the U.S. dollar. Coupled with expectations of an interest rate hike by the Reserve Bank of Australia, the Australian dollar rebounded against the U.S. dollar in the short term.
2. Core negative news (bad for non-U.S. currencies, supporting the US dollar)
With the hawkish nomination of the Federal Reserve, the US dollar has received structural support. Trump nominated the hawkish figure Warsh as chairman of the Federal Reserve. His policy www.xmtraders.combination of "cutting interest rates + shrinking the balance sheet" has attracted market attention. The balance sheet shrinkage plan is expected to reduce market liquidity, support the high short-term financing costs of the US dollar, promote the return of capital to the United States, and strengthen the support of the US dollar index. Market expectations for the Federal Reserve to cut interest rates in March continue to cool. CME Fed Watch shows that the probability of keeping interest rates unchanged in March has risen to 91.1%, further supporting the US dollar.
U.S. economic data are divergent, reinforcing cautious policy expectations. The number of ADP jobs in the United States increased by 22,000 in January, which was lower than market expectations. However, its ISM service industry PMI hit a new high since 2024, and the price index climbed, showing that the resilience of economic recovery and the stickiness of inflation coexist. The data supported the Federal Reserve to maintain policy prudence, and hawkish officials strengthened their opposition to premature interest rate cuts, restraining the rebound of non-US currencies. The U.S. dollar index fluctuated and rebounded to around 97.63.
www.xmtraders.commodity currencies are still under pressure, and the rebound of the Australian and New Zealand dollars is weak. Although geopolitical risks have cooled, if the U.S. dollar continues to strengthen, it will still restrict the gains of www.xmtraders.commodity currencies. In the early stage, the Australian dollar and the New Zealand dollar fell to a four-trading low due to the strong US dollar, and the global economic growth forecast was lowered to 2.6%. The outlook for www.xmtraders.commodity demand was under pressure, further limiting the upside space of www.xmtraders.commodity currencies, and the rebound of the Australian dollar against the US dollar and the New Zealand dollar against the US dollar was limited.
3. Trading tips
The foreign exchange market on that day showed a pattern of "strong European currencies, volatile www.xmtraders.commodity currencies, and structural support for the U.S. dollar." The focus was on speeches by Federal Reserve officials, U.S. non-farm employment data and ECB President Lagarde's press conference. In terms of operation, positions need to be strictly controlled. The EURUSD focuses on breaking through the 1.18-1.1860 range, and the GBP/USD is wary of the risk of breaking the 1.3650 support level. The RMB continues to be strong in the short term, and you can pay attention to the callback layout opportunities. Avoid the risk of unilateral fluctuations after the US dollar index breaks through 97.80, and wait for clear guidance from policies and data.
The above content is all about "[XM Group]: Collection of good and bad news affecting the foreign exchange market". It is carefully www.xmtraders.compiled and edited by the XM foreign exchange editor. I hope it will be helpful to your trading! Thanks for the support!
Every successful person has a beginning. Only by having the courage to start can you find the way to success. Read the next article now!
Disclaimers: XM Group only provides execution services and access permissions for online trading platforms, and allows individuals to view and/or use the website or the content provided on the website, but has no intention of making any changes or extensions, nor will it change or extend its services and access permissions. All access and usage permissions will be subject to the following terms and conditions: (i) Terms and conditions; (ii) Risk warning; And (iii) a complete disclaimer. Please note that all information provided on the website is for general informational purposes only. In addition, the content of all XM online trading platforms does not constitute, and cannot be used for any unauthorized financial market trading invitations and/or invitations. Financial market transactions pose significant risks to your investment capital.
All materials published on online trading platforms are only intended for educational/informational purposes and do not include or should be considered for financial, investment tax, or trading related consulting and advice, or transaction price records, or any financial product or non invitation related trading offers or invitations.
All content provided by XM and third-party suppliers on this website, including opinions, news, research, analysis, prices, other information, and third-party website links, remains unchanged and is provided as general market commentary rather than investment advice. All materials published on online trading platforms are only for educational/informational purposes and do not include or should be considered as applicable to financial, investment tax, or trading related advice and recommendations, or transaction price records, or any financial product or non invitation related financial offers or invitations. Please ensure that you have read and fully understood the information on XM's non independent investment research tips and risk warnings. For more details, please click here