Asian markets saw a mix of currency movements on Thursday, with the yen continuing to strengthen despite thin liquidity due to a holiday in Japan. USD/JPY fell to just below 148.20, while EUR/JPY dipped under 161.75. However, the yen gave up some of its gains following a social media post from former U.S. President Donald Trump, in which he urged the Federal Reserve to cut interest rates as tariffs begin to weigh on the economy.

In New Zealand, economic data showed the country emerging from its mid-2024 recession, with a solid 0.7% quarter-on-quarter GDP growth in the December period. The New Zealand dollar saw a brief lift but ultimately faded, tracking declines in the Australian dollar after a weak labour market report. Australia lost more than 50,000 jobs in February, and the participation rate fell from its record high of 67.2% in January to 66.8%. This prevented the unemployment rate from rising, which remained at 4.1% (dropping slightly to 4.05% when taken to two decimal places). The data strengthens the case for potential Reserve Bank of Australia rate cuts, though it remains only one month of figures. The AUD softened following the release.

Meanwhile, the People’s Bank of China kept its 1- and 5-year Loan Prime Rates (LPRs) steady at 3.1% and 3.6%, marking the fifth consecutive month without easing. Despite ongoing expectations of further stimulus, the central bank has held firm since its last rate cut in September. Analysts continue to anticipate policy support, but the lack of movement suggests the PBOC remains cautious in balancing growth and financial (yuan) stability.

EUR/JPY update:

euryen wrap chart 20 March 2025 2
Source: Forex Live