Editor’s Note
This article discusses the reported early departure of ECB President Christine Lagarde and the potential political strategy behind the succession. The views expressed are based on current speculation and have not been officially confirmed by the European Central Bank.
The euro is currently grappling with a wave of political uncertainty.
Following reports of ECB President Christine Lagarde’s resignation, she has been removed from her post well before her term ends in late 2027. The coordinated early departure allows French President Emmanuel Macron and German Chancellor Friedrich Merz to secure a successor ahead of the 2027 French elections, shielding the institution from the impact of far-right political shifts. While institutional analysts argue that the ECB’s hawkish-dovish balance will remain unaffected by who is president, the market’s immediate reaction has been cautious, keeping the common currency near its recent lows.
Across the Atlantic, the US dollar maintains its dominance as markets adopt a “wait and see” stance ahead of key economic data releases. Although the Federal Reserve has recently signaled a stable policy, internal disagreements are beginning to surface. The upcoming FOMC minutes are expected to reveal growing divisions among policymakers, with some considering multiple interest rate cuts this year in light of declining inflation. However, the real test for the US dollar will come with the release of Q4 GDP and PCE price index data at the end of the week. These figures will either validate the Fed’s current “higher for longer” stance or force a dovish pivot that could shift global currency valuations.
The global landscape shows clear divergence in how major economies are handling post-inflation growth. In Japan, the yen remains under pressure from speculation of heavy fiscal spending and tax cuts due to weak GDP data—a move the IMF has warned could weaken the country’s fiscal health. Meanwhile, in the UK, rising inflation in services is making it difficult for the Bank of England to cut interest rates in March, lending some stability to the British pound. This regional contrast is further heightened by easing geopolitical tensions; progress in US-Iran nuclear talks has somewhat dampened safe-haven demand for gold, while crude oil prices are caught between potential supply increases and the persistent threat of disruptions to Middle Eastern supply chains.
Wednesday, February 18
18/02/2026 – FOMC Minutes (USD)
This is arguably the most important event of the day. The minutes contain a detailed record of the Federal Reserve’s recent interest rate meeting. Investors scrutinize these details for “hawkish” or “dovish” signals—trying to discern whether the Fed plans to raise, lower, or hold interest rates in the coming months. Since it reveals the internal stance of the Fed governors, it often triggers significant volatility in stock and bond markets.
18/02/2026 – Housing Starts and Building Permits (USD)
Both are key indicators for the US economy. Building permits show how many new construction projects have been approved, while housing starts indicate how many have actually begun. Since a healthy housing market boosts demand for labor, lumber, and consumer electronics, high numbers signal future economic expansion, while a decline can be an early sign of an economic slowdown.
Thursday, February 19
19/02/2026 – Employment Change and Unemployment Rate in Australia (AUD)