Russia Central Bank Reserves $ up to $826.8B from previous $786.9B

Russia Central Bank Reserves $ rose from previous $786.9B to $826B

Governor Andrew Bailey took questions from reporters, offering markets a clearer sense of how the central bank was thinking. His remarks followed the widely expected decision to keep the policy rate on hold at 3.75%.

Silver prices have plunged another 17%, erasing a brief recovery and reflecting extreme volatility in precious metals. The renewed drop follows a historic rout, with prices falling significantly below earlier highs.

EUR/JPY trades around 185.40 on Thursday at the time of writing, up 0.10% on the day. The cross is mainly supported by the underperformance of the Japanese Yen, amid rising political uncertainty in Japan, while the Euro shows a more mixed profile due to conflicting macroeconomic signals.

The Euro (EUR) depreciates for the second consecutive day against the US Dollar (USD) on Thursday, trading around 1.1790 at the time of writing, only a few pips above two-week lows, at 1.1777.

The Euro (EUR) is drawing support for a weaker British Pound (GBP) on Thursday, following a dovishly tilted monetary policy decision by the Bank of England (BoE). The pair has jumped to a fresh one-week high beyond 0.8700, from the 0.8660 area.

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The European Central Bank (ECB) is holding its two-day meeting and will announce its monetary policy decision on Thursday.

According to TD Securities, the European Central Bank is anticipated to keep the deposit facility rate at 2.00% with no significant changes in its communication.

The Pound Sterling (GBP) extends its decline against its major currency peers on Thursday, following the Bank of England’s (BoE) monetary policy announcement.

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The US Dollar (USD) appreciates for the second consecutive day against the Canadian Dollar (CAD). Bulls have failed to find acceptance above 1.3700 earlier on the day, but the pair remains bid, trading at 1.3685, with the safe-haven USD favoured by the dismal market mood.

Nomura analysts project that Euro area inflation will hover around the ECB’s 2.0% target until the end of 2027, with GDP growth expected to reach pre-pandemic levels by mid-2026. They foresee potential inflation overshooting in 2028, necessitating rate hikes.

The British Pound and gilts have declined sharply due to political uncertainty surrounding Prime Minister Keir Starmer's leadership.

The USD/JPY extends its winning streak for the fifth trading day on Thursday, trades 0.26% higher to near 156.20. The pair advances further due to continued outperformance from the US Dollar (USD).

Gold (XAU/USD) is accelerating its reversal from Wednesday’s highs near $5,100, trading at $4,865 at the time of writing, with downside attempts contained below $4,790 for now. Precious metals are losing ground despite the risk-averse sentiment, as the US Dollar appreciates across the board.

EUR/GBP trades around 0.8670 on Thursday at the time of writing, up 0.30% on the day, supported by some weakness in the Pound Sterling (GBP) ahead of the Bank of England’s (BoE) monetary policy decision, which is due later in the day, despite mixed economic indicators from the Eurozone.

The upcoming Lower House election in Japan on February 8 is expected to have significant implications for the USD/JPY exchange rate. TD Securities analysts predict that if the ruling Liberal Democratic Party (LDP) secures an absolute majority, USDJPY could rise towards 160.

The US Dollar is flat against the Swiss Franc on Thursday, trading around 0.7780 at the time of writing.

The Indian Rupee (INR) trades higher against the US Dollar (USD) on Thursday. The USD/INR pair declines to near 90.27 as the Indian Rupee holds United States (US)-India trade truce-driven gains.

Eurozone Retail Sales, a key measure of consumer spending, declines 0.5% month-on-month (MoM) in December, faster than estimates of 0.2% fall. In November, the consumer spending measure rose by 0.1%, revised lower from 0.2%.

France 10-y Bond Auction down to 3.38% from previous 3.53%

Spain 3-y Bond Auction declined to 2.341% from previous 2.342%

Eurozone Retail Sales (MoM) came in at -0.5% below forecasts (-0.2%) in December

Eurozone Retail Sales (YoY) below expectations (1.6%) in December: Actual (1.3%)

Spain 10-y Obligaciones Auction: 3.223% vs 1.508%

Societe Generale's report provides insights on the British Pound (GBP) as the BoE's next rate cut timing remains uncertain. It suggests that the statement from the BoE will likely reiterate that inflation is projected to fall back towards the target more quickly in the near term.