Morning Wrap: Dollar in a Trap, All Eyes on NFP (February 11, 2026)

Market Overview

The financial markets opened on a positive note on Wednesday, February 11, 2026, with Asian stocks showing moderate gains. The Kospi index increased by 0.8%, while the Hang Seng index rose by 0.3%, reflecting stable investor sentiment.

Currency Movements

Despite a bank holiday in Japan, the Japanese yen strengthened against other currencies, although there was no clear catalyst for this movement. The US dollar, on the other hand, faced downward pressure, particularly in light of hawkish statements from Federal Reserve officials Hammack and Logan, which suggested a slower pace of policy easing.

China's Economic Data

China's inflation data for January 2026 revealed a year-on-year Consumer Price Index (CPI) growth of 0.2%, falling short of the expected 0.4%. Additionally, Producer Price Index (PPI) figures showed a decline of 1.4% year-on-year, slightly better than the anticipated 1.5% drop. The stability of the yuan was attributed to actions taken by the People's Bank of China (PBoC).

Australia's Economic Outlook

The Australian dollar reached new highs against major currencies following hawkish comments from the Reserve Bank of Australia (RBA). RBA's Hauser emphasized that inflation remains too high, leading to expectations of further interest rate hikes. Following a recent increase to 3.85%, markets are pricing in a 70% chance of a rise to 4.10% by May.

Corporate Earnings Reports

Several companies released their quarterly results just before the European market opened:

• ABN Amro (Q4 2025): Revenue of €2.26 billion, below forecast; profit of €410 million, also below expectations.
• Heineken (FY 2025): Adjusted operating profit of €4.39 billion, slightly above expectations; beer volume down 1.2%.
• Dassault Systèmes (Q4 2025): Non-IFRS revenue of €1.68 billion, below expectations; operating margin close to estimates.
• Siemens Energy (Q1 2026): Revenue of €9.68 billion, below forecast; profit before one-offs exceeded expectations.
• Commerzbank (Q4 2025): Revenue of €3.14 billion, above forecast; net profit of €737 million, better than expected.

Forex Market Dynamics

In the Forex market, the Japanese yen performed well, rising against most currencies. Antipodean currencies also showed strength, while the US dollar continued to face significant downward pressure. Precious metals recorded moderate increases, with silver up 2.1% and gold up 0.66%.

Cryptocurrency Update

Bitcoin experienced a decline of 2.3%, trading around £67,000 at the time of the report.

Upcoming Economic Events

Attention is focused on the upcoming Non-Farm Payroll (NFP) report, scheduled for release at 2:30 p.m. today, which is expected to have significant implications for market movements.