Financial Market Summary - February 16, 2026
Market Overview
On February 16, 2026, the financial markets are experiencing a unique session due to bank holidays in China, the US, and Canada, leading to reduced volatility across many markets. The cash markets are closed, particularly affecting trading activity.
The Asian markets are notably quiet, with Japan's Nikkei showing a slight increase of 0.02% and India's Nifty 50 up by 0.2%. The ongoing Lunar New Year celebrations in China will keep the market closed until the end of the week.
Focus on the US Dollar
This week, the US dollar is in the spotlight, with expectations of a "USD rebalancing." Analysts from Credit Agricole predict a consolidation phase rather than significant movements unless there are indications of weaker economic data or dovish signals from the Federal Reserve. Key upcoming publications include:
- December core PCE data
- Preliminary PMI for February
- FOMC meeting minutes
- December TIC report
These reports will provide insights into foreign demand for US bonds and equities, which could influence market volatility, especially if the outcomes diverge from consensus expectations. Additionally, a potential US Supreme Court ruling on tariffs scheduled for February 20 could also impact market dynamics.
Currency Performance
On the Forex market, the Australian dollar is currently performing the best, while the Japanese yen is experiencing declines. The yen's weakness follows disappointing GDP growth figures, which showed only a 0.2% annualized increase, falling short of expectations. This weak performance raises concerns about the Bank of Japan's ability to tighten monetary policy, reinforcing a narrative of prolonged accommodative measures.
In New Zealand, the service sector continues to grow, but momentum is slowing, with a business sentiment index (PSI) of 50.9. A decline in spending measured by payment card transactions in January indicates seasonal weakness, limiting expectations for interest rate cuts.
Commodity and Cryptocurrency Updates
In the commodities market, both silver and gold are down, with silver decreasing by 1.2% and gold by 0.83%. However, natural gas prices have seen the most significant drop, falling nearly 7% due to forecasts of higher-than-average temperatures over the next two weeks.
In the cryptocurrency space, Bitcoin has lost 1% and is trading close to £68,000, as the market attempts to stabilize following recent sell-offs.