USD momentum is building following stronger-than-expected US data and a firmer tone from the Fed. With markets scaling back rate cut expectations and pricing in a more “higher-for-longer” outlook, FX volatility remains elevated — and opportunities are emerging for proactive businesses.
Key Highlight
The meeting minutes indicate a growing hawkish tone
Market Recap
The US dollar strengthened following a series of upbeat economic releases. Durable goods orders, building permits and industrial production all exceeded expectations, reinforcing confidence in the resilience of the US economy. While some of the move may have been amplified by short-position covering, investor attention is clearly shifting toward stronger growth momentum rather than softer employment signals.
In contrast, the New Zealand dollar came under pressure, falling around 1% after RBNZ Governor Anna Breman indicated there is little urgency to tighten policy further.
Sterling and the euro also weakened. GBP was weighed down by softer UK inflation data, which supports a more cautious rate outlook, while EUR sentiment was unsettled by reports suggesting ECB President Christine Lagarde could leave her role before her term concludes in 2027.
Market Overview:
AUD strengthens on resilient labour data
The Australian dollar moved higher after unemployment held steady at 4.1%, beating expectations of a slight rise to 4.2%. The data has reinforced expectations that the RBA could tighten policy in May, with market pricing for a rate hike rising to around 88%, up from roughly 80% beforehand.
USD supported by firmer Fed tone
The US dollar extended gains overnight following the latest FOMC minutes, which carried a mildly hawkish message. Policymakers flagged ongoing concerns around persistent inflation, with several members indicating rates could move higher again if price pressures fail to ease.
Busy US data calendar ahead
This afternoon brings a heavy run of US releases, including Continuing and Initial Jobless Claims, the Philadelphia Fed survey, Wholesale Inventories, the Trade Balance and Pending Home Sales. After recent upside surprises in durable goods, housing and industrial production, another round of strong data could add further momentum to the dollar. Conversely, weaker prints may prompt some near-term pullback.
Eurozone focus tomorrow
Eurozone Consumer Confidence is due tomorrow. With the euro already on the back foot amid ECB uncertainty, a soft reading could leave the single currency exposed. A stronger result may offer some stability.
What This Means
The US dollar is currently the primary driver of FX markets as expectations for near-term US rate cuts continue to fade — a notable shift from earlier in the month.
For businesses with USD exposure, ongoing data strength could keep the dollar supported in the short term. However, with positioning becoming increasingly one-sided, volatility risks remain if upcoming figures disappoint.
19th February 2026
How We Can Help...
Our team are here to help you get more from your money when making international payments. We will work with you to understand your payment needs and offer guidance on the best options available to you.
Get in Touch!
P: 07441 910 897
E: FX-Admin@frank-exchange.com
This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information, or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result. Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.
Contact Us
Office
Unit F1, Ransom Hall, Ransom Wood Business Park, Southwell Road West,
Mansfield, NG21 0HJ.
Legals:
Payment and e-money services (Non MIFID related products) are provided by The Currency Cloud Limited. Registered with the Dutch Chamber of Commerce in the Netherlands under number 72186178. Registered office Mr. Treublaan 7, 1097 DP, Amsterdam, Netherlands. CurrencyCloud B.V. is licensed and regulated by De Nederlandsche Bank as an Electronic Money Institution (Relation Number: R142701)
For United States, Payment services for Frank Exchange Limited (Non MIFID related products) are provided by Visa Global Services Inc. (VGSI), a licensed money transmitter (NMLS ID 181032) in the states listed here.VGSI is licensed as a money transmitter by the New York Department of Financial Services. Mailing address: 900 Metro Center Blvd, Mailstop 1Z, Foster City, CA 94404. VGSI is also a registered Money Services Business (“MSB”) with FinCEN and a registered Foreign MSB with FINTRAC. For live customer support contact VGSI at (888) 733-0041.
Frank eXchange’s Payment and Foreign Currency Exchange Services are also provided by Ebury Partners UK Limited.
Ebury Partners UK Limited (EPUK) is an Authorised Electronic Money Institution (Financial Services Register No. 900797) and is licensed to provide payment services including FX spots and FX Forwards for the commercial purpose of the facilitation of payments for identifiable goods or services and direct investments. Ebury Partners UK Limited is registered with the Information Commissioner's Office, with registration number: ZA345828.
Anti-Bullying and Harassment Policy
At Frank eXchange Limited, we are committed to providing a safe and respectful environment for both our customers and staff. We do not tolerate any form of bullying, harassment, or abusive behaviour towards our employees.
Any communication that is deemed offensive, threatening, or disrespectful may result in the termination of services. We expect all interactions to be conducted with professionalism and courtesy to ensure a positive experience for everyone involved.
Thank you for your understanding and cooperation.