AUD-Led Dollar Weakness Reverses to USD Buying | Focus Shifts to Middle East and Equities

■ Market Overview

During the Tokyo session, AUD strength led to broad USD selling.

• China GDP
• Australia employment data

→ Strong results triggered AUD buying, spilling over into overall USD weakness

In addition:

• Comments from Japan’s finance officials raised intervention concerns

→ Capping upside in USD/JPY

However, in the afternoon session, USD buying resumed,
shifting the market into a directionless environment.

■ FX Market Dynamics

• USD/JPY: Rose to the low 159 range
• EUR/USD: Declined
• GBP/USD: Temporarily rose on stronger-than-expected GDP

→ Market moved from cross-driven flows → back to USD-driven flows

■ Core Market Theme

“A fragmented market where leadership rotates across assets.”

• Tokyo: AUD-led
• London: USD buying returns
• GBP: Driven by economic data

→ No consistent trend across the market

■ Key Focus (Top Priority)

• Middle East developments (ceasefire expectations)
• Strength in equities (S&P 500 testing highs)
• Oil prices (holding around $92)

→ The key question: Will risk-on conditions continue?

■ Scenario Outlook

① Continued Risk-On

→ Equities rise
→ JPY crosses move higher
→ USD remains capped

② Middle East Escalation

→ Oil rises
→ Safe-haven USD buying returns

③ Mixed Signals

→ Range-bound market

■ Key Events Today

• U.S. Philadelphia Fed Index
• U.S. Jobless Claims
• ECB Meeting Minutes

※ However, the main drivers remain:
→ Middle East + Equities

■ Strategy Points

• Focus on relative currency strength
• Avoid viewing the market through USD alone
• Adapt to cross-driven flows

■ Summary

The current market is:

“A rotating market where leadership constantly shifts.”

→ AUD → USD → GBP rotation

→ Most important factors:
Continuation of Middle East developments and equity trends