The global forex market on April 10, 2025, is marked by significant volatility as traders digest fresh economic data, central bank communications, and ongoing geopolitical tensions. The U.S. dollar saw mixed performance across major currency pairs as market sentiment shifted in response to inflation expectations, monetary policy divergence, and global risk factors. Here’s a detailed breakdown of the key developments.
EUR/USD – Euro Weakens Amid Dovish ECB and Geopolitical Pressures
The EUR/USD pair traded lower today, hovering near 1.0330, as the euro came under pressure due to continued dovish rhetoric from the European Central Bank (ECB). ECB President Christine Lagarde reaffirmed that rate cuts are “not off the table” for the second half of 2025, citing weak inflation momentum and sluggish growth across the Eurozone.
Adding to bearish sentiment, fresh industrial production data from Germany came in weaker than expected, further fueling concerns about the euro area’s economic resilience.
Key technical levels:
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Support: 1.0300, 1.0200
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Resistance: 1.0450, 1.0520
Outlook: Bearish bias remains as long as the pair stays below 1.0450. A break below 1.0300 could pave the way for a test of parity in coming weeks.
GBP/USD – Sterling Holds Gains on Strong Wage Growth
GBP/USD saw modest gains today, trading around 1.2920, supported by robust wage growth data out of the UK. Average earnings excluding bonuses rose by 6.1% YoY, signaling sticky inflation pressures that may compel the Bank of England (BoE) to delay rate cuts.
Governor Andrew Bailey, in remarks earlier this week, emphasized a “data-dependent” approach but noted that inflation in the services sector remains elevated.
Key technical levels:
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Support: 1.2860, 1.2780
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Resistance: 1.2980, 1.3050
Outlook: Bullish momentum could extend if GBP/USD breaches 1.2980. However, upcoming GDP data on Friday may introduce volatility.
USD/JPY – Dollar-Yen Resumes Climb Amid Yield Divergence
USD/JPY traded higher today, reaching 150.90, as the widening yield differential between the U.S. and Japan continued to favor the dollar. The Bank of Japan reiterated its commitment to maintaining accommodative policy, despite a slight uptick in inflation expectations.
Meanwhile, U.S. Treasury yields rose on the back of stronger-than-expected PPI data, reinforcing bets that the Federal Reserve will keep interest rates elevated for longer.
Key technical levels:
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Support: 149.80, 148.50
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Resistance: 151.20, 152.00
Outlook: USD/JPY could challenge the 152.00 level if U.S. inflation data tomorrow surprises to the upside. Traders should remain cautious of potential verbal intervention from Japanese officials.
USD/CHF – Dollar Steady Against Franc Amid Safe-Haven Demand
The USD/CHF pair is trading around 0.8770, showing resilience despite geopolitical jitters. The Swiss franc initially gained on safe-haven flows due to escalations in the Middle East, but the pair rebounded as investors sought the U.S. dollar for yield and liquidity.
Switzerland’s CPI data released earlier this week was slightly softer, reducing expectations for another SNB rate hike.
Key technical levels:
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Support: 0.8725, 0.8670
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Resistance: 0.8800, 0.8860
Outlook: Consolidation is likely in the short term unless there is a significant geopolitical shock. Watch for SNB commentary as the central bank monitors FX strength.
Other Notable Developments
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AUD/USD: The Aussie fell below 0.6500 following weak Chinese import data and softer-than-expected Australian building permits.
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USD/CAD: Loonie strengthened slightly to 1.3570 after the Bank of Canada held rates steady and upgraded its GDP forecast.
Critical Events Impacting Market Sentiment
U.S. Inflation Focus
Markets are keenly awaiting tomorrow’s U.S. CPI release. A hotter-than-expected print could reignite fears of prolonged tight monetary policy, potentially boosting the dollar across the board.
Geopolitical Risk
Renewed tensions in the Middle East and the continued conflict in Ukraine are adding to overall risk aversion. These factors are supporting safe-haven flows into the USD and JPY.
Central Bank Divergence
The growing gap between the Fed’s “higher for longer” messaging and the more dovish tones from the ECB and BoJ is reshaping capital flows and FX valuations.
Market Outlook and Strategy for Traders
Traders should remain vigilant as the FX market continues to be driven by a blend of macroeconomic data and geopolitical developments. With multiple inflation reports and central bank meetings on the horizon, volatility is expected to remain elevated.
