What Drives the G10 Currencies?

Before you look at a single pair, it helps to know what actually moves each currency. This guide breaks down the core drivers of all ten G10 currencies — and, for each, the less-obvious watch that most retail traders overlook. The goal isn't a signal. It's to help you build a macro view of a currency before you look at a pair — because in FX, nothing moves alone.

Compare a Pair, Side by Side

A pair is a relative trade — the question isn't "is AUD strong?" but "is the AUD story stronger than the NZD story?" Pick a direction and a pair. The idiosyncratic drivers (unique to one currency — dairy for NZD, iron ore for AUD) are the clean separators; ◆ shared drivers (China, risk, oil) hit both sides, so they turn on who's more sensitive.

How to Use This Guide

Jump to a currency: USD · EUR · JPY · GBP · CHF · CAD · AUD · NZD · NOK · SEK.

For each one you'll find four things:

• Core drivers — the obvious macro forces.
• Why it matters — how those forces transmit into the currency.
• Less-obvious watch — the second-order signal most people miss (the value-add).
• Example pairs — where that currency's drivers actually show up.

Read every driver as a tendency, not a rule — "oil up tends to support CAD," never "oil up = buy CAD." And remember the rule below: a currency is only ever strong or weak relative to another.

Start with the cheat sheet — a fast reference for each currency (what to watch + where to get the real data). Each card links down to the full breakdown. This is a data map, not a trigger list: it hands you the inputs; you decide.

The G10 at a Glance

Each linked driver opens a live chart or dataset — a TradingView chart for prices, yields and macro series, or the primary source where TradingView has none. It's a data map: it hands you the inputs; you decide.

A Currency Does Not Move Alone

"Oil is rising, so CAD should strengthen" is an incomplete thought. The real question is: is CAD strengthening more than the currency you're comparing it against?

Take AUD/CHF. That pair is Australian growth + the RBA + China + commodities versus Swiss inflation + the SNB + European conditions + safe-haven demand — two completely different stories, netted against each other. That's why the same currency can look strong in one pair and weak in another, and why "short USD" isn't really a plan until you've said against what.

What Drives the US Dollar (USD)?

Core drivers. Fed rate expectations, US economic data, Treasury yields, US–global yield differentials, and risk sentiment.

Why it matters. The dollar sits on one side of most of the world's liquidity. When the Fed is expected to stay higher for longer, or US yields rise relative to peers, dollar assets pay more to hold — which tends to support USD. In risk-off moments, the dollar also draws safe-haven demand.

Less-obvious watch. The DXY is a readout, not a driver. When it moves, don't stop at "the dollar is strong" — ask why: yields? Fed repricing? risk sentiment? Or is it really just one other currency doing the moving (the euro alone is more than half of DXY)?

Example pairs. EUR/USD · USD/JPY · GBP/USD · USD/CAD. The question to ask isn't "is USD strong?" but "is its strength broad-based, or concentrated in one pair?"

What Drives the Euro (EUR)?

Core drivers. ECB rate expectations, Eurozone data, German and EZ bond yields, energy prices, and political/fiscal developments.

Why it matters. The euro is the dollar's main counterweight, so many "dollar" moves are really euro moves. ECB expectations and EZ–US yield gaps drive relative demand, and energy shocks hit the bloc's terms of trade.

Less-obvious watch. Compare EUR/USD against EUR/JPY. If EUR/USD is up but EUR/JPY is flat, the move is probably dollar-driven, not euro strength. Watching the euro against more than one counterpart tells you whether the euro is actually leading.

Example pairs. EUR/USD · EUR/GBP · EUR/JPY · EUR/CHF.

What Drives the Japanese Yen (JPY)?

Core drivers. BoJ rate expectations, the US–Japan yield differential, Japanese inflation, Japan data, and risk sentiment.

Why it matters. The yen is unusually sensitive to yield differentials — when US yields sit far above Japan's, capital tends to flow out of the yen. It's also a classic funding and haven currency, so it often strengthens when markets turn risk-off.

Less-obvious watch. Intervention risk. Near politically sensitive USD/JPY levels, Japan's Ministry of Finance may signal or act — and the expectation of intervention can move the market before anything actually happens. Watch official language, not just the level. (Information to weigh, not a trade trigger.)

Example pairs. USD/JPY · EUR/JPY · AUD/JPY · CHF/JPY.

What Drives the British Pound (GBP)?

Core drivers. BoE rate expectations, UK inflation, the UK labour market, UK growth, and gilt yields.

Why it matters. Sterling trades heavily on the BoE's path, which in turn hangs on how sticky UK inflation looks. Shifts in rate expectations show up quickly in the pound.

Less-obvious watch. UK services inflation and wage growth can matter more to the BoE than headline GDP — they speak to domestically-generated, persistent inflation. A strong services or wage print can move rate expectations even on an otherwise quiet week.

Example pairs. GBP/USD · EUR/GBP · GBP/JPY.

What Drives the Swiss Franc (CHF)?

Core drivers. SNB rate expectations, Swiss inflation, risk sentiment, European conditions, and US–Swiss / EUR–Swiss yield differentials.

Why it matters. The franc is a premier safe haven, so it tends to firm in risk-off periods and when European stress rises. Swiss inflation is typically low, which makes the SNB's tolerance for currency moves especially important.

Less-obvious watch. The SNB's tolerance for a strong franc. Excessive appreciation can become a policy concern — so watch SNB communication as closely as the rate itself. A strong-franc phase can meet verbal (or actual) pushback.

Example pairs. USD/CHF · EUR/CHF · AUD/CHF.

What Drives the Canadian Dollar (CAD)?

Core drivers. WTI oil, Canadian data, BoC rate expectations, the US–Canada yield differential, and risk sentiment.

Why it matters. Canada is a major oil exporter, so crude is a terms-of-trade lever for CAD. But oil alone isn't enough — the BoC's path and the US–Canada yield gap decide whether an oil move becomes actual currency demand.

Less-obvious watch. Oil inventories and the US–Canada yield gap, together. Oil shows the terms-of-trade impulse; the yield gap shows whether it's translating into CAD demand. One without the other is only half the picture.

Example pairs. USD/CAD · CAD/JPY · AUD/CAD.

What Drives the Australian Dollar (AUD)?

Core drivers. RBA rate expectations, Australian data, China's growth, iron ore and commodity prices, and risk sentiment.

Why it matters. The Aussie is a growth- and China-sensitive currency. Because Australia exports heavily to China, Chinese demand often matters as much as domestic Australian data — and AUD tends to behave as a "risk-on" currency.

Less-obvious watch. China CPI/PPI and iron ore. Chinese inflation and producer-price trends can hint at shifts in Chinese demand before they show up in Australian data — an early read most retail traders never look at. Add it to your view of AUD; don't treat it as an entry signal.

Example pairs. AUD/USD · AUD/JPY · AUD/CHF · EUR/AUD.

What Drives the New Zealand Dollar (NZD)?

Core drivers. RBNZ rate expectations, NZ data, dairy prices, China's growth, and risk sentiment.

Why it matters. Like the Aussie, the kiwi is a small, open, commodity- and China-linked currency. Dairy is its signature export, so global dairy demand feeds directly into its terms of trade.

Less-obvious watch. GDT dairy auctions. The Global Dairy Trade results are an early read on external demand and New Zealand's terms of trade — useful context for the NZD picture ahead of the domestic data.

Example pairs. NZD/USD · NZD/JPY · AUD/NZD.

What Drives the Norwegian Krone (NOK)?

Core drivers. Norges Bank rate expectations, oil prices, Norwegian data, European growth, and risk sentiment.

Why it matters. Norway is an oil-and-gas exporter, so energy is a core terms-of-trade driver. But NOK is also a smaller, less-liquid currency that's sensitive to European growth and risk appetite.

Less-obvious watch. European demand and oil, together. NOK isn't purely an "oil currency" — European growth and risk conditions decide whether higher oil actually turns into krone strength. Weak Europe can mute an oil rally's effect on NOK.

Example pairs. USD/NOK · EUR/NOK · NOK/JPY.

What Drives the Swedish Krona (SEK)?

Core drivers. Riksbank rate expectations, Swedish data, European growth, risk sentiment, and EUR/SEK dynamics.

Why it matters. Sweden is a small, open, export-heavy economy tightly linked to Europe, so the krona often trades as a European growth/risk proxy as much as on domestic data.

Less-obvious watch. EUR/SEK itself. Because SEK behaves partly as a European proxy, EUR/SEK tells you whether a krona move is genuinely Swedish or just broad European risk sentiment flowing through.

Example pairs. EUR/SEK · USD/SEK · SEK/JPY.

How to Put the Drivers Together

Once you can describe each currency's drivers, a pair stops being a single ticker and becomes two stories netted against each other. Build the view in this order:

1. What's driving currency A right now? Which of its drivers is dominant this week? 2. What's driving currency B? 3. Which story is stronger — and is the market behaving consistently with that?

That last step is where price is evidence, not proof: a pair moving your way supports the story, it doesn't confirm it. If the drivers say one thing and price says another, that tension is itself information.

Where the FXStrength Meter Comes In

You can hold all of this in your head for one pair. Across ten currencies and dozens of pairs, it's a lot to track — which is exactly what the strength meter is for. It organizes the evidence: it shows, across all the majors at once, which currencies are actually strong and weak right now, so you can see whether a currency's story is showing up broadly or only in one noisy pair.

A currency can be strong. A currency can be weak. But a pair tells you which one is stronger.

The meter reads the current strength across the board — it organizes evidence, it does not predict. See the live strength meter →

Key Takeaway

Every currency has its obvious drivers and its less-obvious watch — and none of it means anything until you ask relative to what. Build a view of each currency first; let the pair be the two views netted together; and use the meter to check whether the story is actually showing up in the market. That's the difference between reacting to "oil is up" and understanding what's really moving.

Frequently Asked Questions