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Soft U.S. CPI Fails to Spark Breakout as Markets Drift Into Holiday Mode

February 16, 2026

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Forex Market

USD Softens After CPI Miss; AUD Holds Above 0.70

The U.S. dollar softened after a weaker-than-expected U.S. CPI print, although price action stabilized into the close. Thin liquidity ahead of the U.S. Presidents Day holiday and the Lunar New Year break across Asia kept trading ranges relatively contained.

Core CPI met expectations, while headline inflation came in slightly below forecasts, prompting an initial pullback in the USD and a modest rally in bonds. U.S. 10-year yields eased over the session as markets reassessed the inflation outlook.

In currency markets, AUD/USD traded within a tight range and finished the session above the 0.70 handle. EUR/USD and GBP/USD both moved higher following the CPI release before steadying, while USD/JPY fluctuated within recent levels. The DXY index edged lower but remained broadly range-bound.

From a technical perspective, buying interest in AUD/USD is seen ahead of the 0.70 region, while offers remain layered above 0.72. The pair continues to consolidate within its broader range, reflecting balanced positioning amid lighter market participation.

General Market

Wall Street

Dow Jones: +0.1% → 49,501
S&P 500: 0.0% → 6,836
Nasdaq: -0.2% → 22,547
VIX: -0.7% → 20.67

Asia-Pacific

ASX 200: -1.4% → 8,918
Shanghai Comp: -1.3% → 4,082
Nikkei: -1.2% → 56,942

Europe

FTSE 100: +0.4% → 10,446
DAX: +0.3% → 24,915
CAC 40: -0.3% → 8,312
Euro Stoxx 50: -0.5%

Headlines to Watch

United States

Seven Fed officials (Kashkari, Barr, Daly, Bostic, Logan, Bowman, Goolsbee) scheduled to speak.
Markets to assess tone following softer CPI print.
U.S. closed Monday for Presidents Day.

China

Lunar New Year holiday (Feb 15–23).
Holiday consumption to test divergence between improving CPI and weaker high-frequency indicators (e.g., auto sales).
Data calendar relatively quiet during the break.

Japan

Q4 GDP expected at +0.4% QoQ rebound.
Business investment likely to recover.
Household consumption may remain soft amid weak real incomes.

Currency Pair	Mid-market Rate
AUD/USD	0.7068
AUD/NZD	1.1711
AUD/JPY	108.01
AUD/CNY	4.8857
AUD/EUR	0.5958
AUD/GBP	0.5180
AUD/HKD	5.5257

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