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Global markets opened the week cautiously as investors assessed the impact of Fed Chair Kevin Warsh’s hawkish Jackson Hole message while turning their attention toward this week’s US labor-market data. Expectations for a September Fed rate hike increased sharply after Warsh warned that policymakers still have work to do on inflation, although the US Dollar eased modestly in early Monday trading. Precious metals remained under pressure, with Gold falling below $4,450 and Silver retreating toward $66, while renewed US-Iran tensions pushed crude prices higher and provided support for the Canadian Dollar. With Friday’s Nonfarm Payrolls report approaching, incoming labor data could determine whether markets reinforce or reconsider expectations for further Fed tightening.
The Swiss Franc strengthened against the US Dollar on Monday, pushing USD/CHF toward 0.8090 as the Greenback surrendered some of its post-Jackson Hole gains. The move comes despite Warsh’s hawkish message, with some economists arguing that the Fed may still keep rates unchanged in September unless upcoming inflation data surprise materially to the upside.
• Fed Expectations: Markets raised the probability of a September rate hike significantly following Warsh’s Jackson Hole remarks.
• US Dollar: Profit-taking is limiting the Greenback despite the increasingly hawkish Fed outlook.
• US Labor Data: This week’s employment releases, culminating in NFP, could significantly alter expectations for September.
• SNB Policy: The Swiss National Bank remains at 0%, limiting the Franc’s yield advantage.
• Safe-Haven Demand: Renewed geopolitical uncertainty could provide additional support for CHF.
• Trend: Neutral to Bearish
• Resistance: 0.8150
• Support: 0.8050
• Forecast: USD/CHF could remain under pressure while the Dollar consolidates its recent gains. A sustained move below 0.8050 could expose the psychological 0.8000 region, while stronger US employment data or renewed Fed-hike expectations could drive the pair back toward 0.8150.
• Market Sentiment: Cautiously bullish for CHF.
• Catalysts: US NFP, Fed rate expectations, Swiss inflation, US Treasury yields and geopolitical developments.
The US Dollar Index started NFP week slightly softer around the 99.50 region, consolidating after the strong reaction to Warsh’s Jackson Hole speech. His warning that underlying inflation must move convincingly toward the Fed’s 2% objective caused markets to sharply increase expectations for a September rate increase.
• Fed Policy: Warsh’s hawkish message has strengthened expectations that rates could remain higher or rise further.
• Rate-Hike Expectations: Markets moved from roughly 35% odds of a September hike before Jackson Hole to around 57% afterward.
• US NFP: Friday’s employment report represents the week’s biggest potential catalyst for the Dollar.
• Treasury Yields: Higher yields could restore demand for USD, while declining yields would limit upside.
• Geopolitical Risks: Renewed US-Iran tensions could generate additional safe-haven demand for the Greenback.
• Trend: Neutral to Bullish
• Resistance: 100.00
• Support: 99.00
• Forecast: DXY could remain supported above 99.00 as traders position for potentially tighter Fed policy. A decisive break above the psychological 100.00 level would reinforce bullish momentum, while weaker US employment figures could push the index back below 99.00.
• Market Sentiment: Cautiously bullish.
• Catalysts: US employment data, NFP, Fed expectations, Treasury yields and Middle East developments.
Silver extended its correction at the beginning of the week, falling toward the $66.00 region as Warsh’s hawkish Jackson Hole remarks increased expectations for additional Fed tightening. Like Gold, Silver faces pressure when interest-rate expectations and Treasury yields rise because the metal does not provide interest income.
• Fed Expectations: Increased September rate-hike expectations are weighing on precious metals.
• US Dollar: Renewed Dollar strength remains a major downside risk for Silver.
• Treasury Yields: Higher yields increase the opportunity cost of holding non-yielding metals.
• US Jobs Data: Strong labor figures could reinforce the Fed’s ability to maintain tighter monetary policy.
• Gold Correlation: Continued weakness in Gold could add to broader precious-metals selling pressure.
• Trend: Bearish
• Resistance: $68.00
• Support: $65.00
• Forecast: Silver could remain under pressure while trading below the $68.00 region. A break below $65.00 would strengthen the bearish outlook, while softer US employment data could weaken the Dollar and allow Silver to stage a recovery.
• Market Sentiment: Bearish to cautious.
• Catalysts: US NFP, Fed expectations, Treasury yields, US Dollar direction and Gold performance.
The Canadian Dollar strengthened against the Greenback, pushing USD/CAD toward the 1.3890 region, as higher crude-oil prices provided support for the commodity-linked currency. Renewed tensions between the United States and Iran have returned a geopolitical risk premium to energy markets after the US carried out fresh strikes against Iranian military targets.
• Oil Prices: Rising crude prices generally provide support for the Canadian Dollar.
• US-Iran Tensions: Renewed military activity has increased concerns surrounding Middle East energy supplies.
• Fed Expectations: Hawkish US rate expectations could limit CAD gains by supporting the Dollar.
• Employment Data: Both US and Canadian labor-market figures will be important for USD/CAD later this week.
• Risk Sentiment: Escalating geopolitical tensions could create competing safe-haven demand for USD.
• Trend: Neutral to Bearish
• Resistance: 1.3950
• Support: 1.3850
• Forecast: USD/CAD could remain under modest downward pressure if crude prices continue rising and supporting the Loonie. A break below 1.3850 could extend the decline, while strong US labor data or a reversal in oil prices could drive the pair back toward 1.3950.
• Market Sentiment: Moderately bullish for CAD.
• Catalysts: Oil prices, US-Iran developments, US NFP, Canadian employment data and Fed expectations.
Gold extended its recent decline on Monday, falling toward $4,445 as markets continued digesting Warsh’s hawkish Jackson Hole message. Expectations for a September Fed hike increased substantially following his comments, creating pressure on the non-yielding metal even as renewed US-Iran tensions provided some underlying safe-haven support.
• Fed Rate-Hike Bets: Markets now see roughly a 57% probability of a September increase, significantly higher than before Jackson Hole.
• Warsh’s Remarks: The Fed Chair emphasized that policymakers still have work to do if inflation fails to move convincingly toward target.
• US NFP: Friday’s employment figures could either reinforce or challenge expectations for further tightening.
• US Dollar and Yields: Stronger USD and higher Treasury yields remain major headwinds for bullion.
• Geopolitical Risks: Fresh US military action against Iran could preserve safe-haven demand and limit deeper Gold losses.
• Trend: Neutral to Bearish
• Resistance: $4,500
• Support: $4,400
• Forecast: Gold could remain vulnerable while trading below $4,500, with the $4,400 region becoming an important near-term test. A decisive break below support could deepen the correction, while weaker US employment figures or an escalation in geopolitical tensions could encourage buyers to return. FXStreet notes that the broader near-term structure remains supported above its 100-day moving average despite the recent pullback.
• Market Sentiment: Cautious to bearish.
• Catalysts: US NFP, Fed rate expectations, Treasury yields, US Dollar direction and US-Iran tensions.
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Global markets entered Friday with monetary-policy divergence firmly in focus as traders prepared for Fed Chair Kevin Warsh’s Jackson Hole address. The Australian and New Zealand Dollars strengthened as expectations for additional RBA and RBNZ tightening increased, while hotter Tokyo inflation reinforced the possibility of a September Bank of Japan rate hike. Sterling remained relatively resilient despite expectations for the Bank of England’s next rate increase being pushed further out, while Gold slipped below $4,600 as persistent US inflation kept further Fed tightening on the table. With the US NFP annual revision and Jackson Hole remarks also due, interest-rate expectations remain the primary driver across FX and precious metals.
The New Zealand Dollar gained ground against the US Dollar, with NZD/USD trading around 0.5960 during Friday’s Asian session. The Kiwi is benefiting from increasingly hawkish expectations surrounding the Reserve Bank of New Zealand, with markets heavily pricing a 25-basis-point hike at the September meeting following stronger inflation data.
• RBNZ Expectations: Markets are strongly pricing a September rate increase, providing support for NZD.
• New Zealand Inflation: Hotter-than-expected Q2 inflation has strengthened the case for additional monetary tightening.
• Rate Outlook: Expectations that the RBNZ could continue tightening toward a higher terminal rate are supporting the Kiwi.
• Fed Policy: A hawkish message from Warsh could strengthen the US Dollar and limit NZD/USD gains.
• Market Positioning: Heavy speculative short positioning could amplify upside moves if traders unwind bearish NZD positions.
• Trend: Bullish
• Resistance: 0.5990
• Support: 0.5910
• Forecast: NZD/USD retains a positive bias while trading above its 100-day SMA. A sustained break above 0.5990 could open the door toward the psychological 0.6000 level and potentially extend the recovery. On the downside, a move below 0.5910 could expose 0.5845.
• Market Sentiment: Moderately bullish.
• Catalysts: RBNZ rate expectations, Warsh’s Jackson Hole speech, US Dollar direction and US rate expectations.
The Australian Dollar extended its winning streak for a fourth consecutive session, with AUD/USD trading around 0.7200 and approaching recent multi-month highs. Stronger-than-expected Australian inflation has sharply increased expectations for additional Reserve Bank of Australia tightening, providing the Aussie with significant support.
• RBA Expectations: Markets are now pricing roughly a 50% probability of a September rate increase, sharply higher than previously.
• Australian Inflation: Persistent price pressures have strengthened expectations that the RBA will need to tighten further.
• Bank Forecasts: Major Australian banks have brought forward expectations for additional policy tightening.
• Yield Advantage: A higher Australian rate outlook is increasing the currency’s relative appeal.
• Fed Policy: Warsh’s Jackson Hole remarks could determine whether USD strength interrupts AUD’s recent advance.
• Trend: Bullish
• Resistance: 0.7250
• Support: 0.7160
• Forecast: AUD/USD remains technically constructive above its short- and medium-term moving averages. However, an RSI above 70 suggests the pair is entering overbought territory. A sustained move beyond 0.7200 could extend the advance toward 0.7250, while profit-taking could initially bring 0.7160 back into focus.
• Market Sentiment: Bullish, although increasingly stretched.
• Catalysts: RBA rate expectations, Australian inflation outlook, Jackson Hole, US yields and broader risk sentiment.
Gold slipped below the psychological $4,600 level during Friday’s Asian session, trading around $4,580 after retreating from its recent three-month high. Persistent US inflation has increased expectations that the Federal Reserve could tighten policy further, raising the opportunity cost of holding the non-yielding precious metal.
• Fed Expectations: Markets have increased expectations for another US rate increase following the latest inflation figures.
• Jackson Hole: Warsh’s speech represents the most important immediate catalyst for Gold.
• US Inflation: Core PCE remained at 3.3% year-over-year, keeping inflation well above the Fed’s target.
• Treasury Yields: Higher yields would pressure Gold, while falling yields could encourage renewed buying.
• Geopolitical Risk: Uncertainty surrounding the Strait of Hormuz and Iran’s conditions for reopening it could preserve some safe-haven demand.
• Trend: Neutral to Bearish
• Resistance: $4,600 – $4,620
• Support: $4,550
• Forecast: Gold could remain under pressure while trading below $4,600, particularly if Warsh reinforces expectations for tighter Fed policy. A recovery above the $4,600-$4,620 area could restore bullish momentum, while a decisive break below $4,550 could expose the metal to a deeper correction.
• Market Sentiment: Cautious ahead of Jackson Hole.
• Catalysts: Warsh’s speech, Fed rate expectations, Treasury yields, US Dollar direction and geopolitical developments.
The British Pound remained relatively resilient around the 1.3600 region even as expectations for the Bank of England’s next rate increase shifted further into the future. Falling energy prices are helping ease UK inflation concerns, reducing the urgency for additional monetary tightening and leading markets to push some BoE hike expectations into 2027.
• BoE Expectations: Softer inflation pressures are allowing markets to delay expectations for further tightening.
• Energy Prices: Lower energy costs could reduce UK inflationary pressure and weaken the case for near-term rate hikes.
• Sterling Momentum: GBP has gained substantially since late July, although much of the move has reflected broader US Dollar weakness.
• Fed Outlook: Warsh’s policy message could have a greater immediate impact on GBP/USD than domestic UK developments.
• US Dollar: Renewed USD strength remains one of the primary risks to Sterling’s recent gains.
• Trend: Neutral to Bullish
• Resistance: 1.3700
• Support: 1.3500
• Forecast: GBP/USD could remain supported while holding above the 1.3500 area, but recent momentum indicators suggest the rally has become stretched. A break above 1.3700 would reinforce the bullish structure, while a hawkish Fed surprise could trigger a correction toward the mid-1.3500 region.
• Market Sentiment: Cautiously bullish.
• Catalysts: BoE expectations, UK inflation outlook, Jackson Hole, US NFP revision and US Dollar direction.
The Japanese Yen strengthened on Friday, pushing USD/JPY down toward 159.30 after Tokyo inflation data strengthened expectations for a Bank of Japan rate increase. Tokyo core CPI accelerated to 1.8% year-over-year in August, above the 1.7% market forecast, while inflation excluding food and energy climbed to 2.0%.
• Tokyo Inflation: Stronger underlying inflation is reinforcing expectations for further BoJ tightening.
• BoJ Expectations: Markets are considering the possibility of a rate increase at the September 17–18 meeting.
• Yield Differentials: Higher Japanese rate expectations could narrow the US-Japan yield gap and support the Yen.
• Fed Policy: A hawkish Warsh speech could strengthen US yields and partially offset JPY gains.
• Technical Positioning: USD/JPY remains capped beneath its 100-day moving average, limiting near-term upside momentum.
• Trend: Neutral to Bearish USD/JPY
• Resistance: 160.00 – 160.30
• Support: 158.85
• Forecast: USD/JPY could remain under pressure if markets continue increasing expectations for a September BoJ hike. A break below 158.85 could expose 157.45, while a recovery through the 160.00-160.30 resistance zone would be needed to restore stronger bullish momentum.
• Market Sentiment: Bullish for JPY.
• Catalysts: BoJ rate expectations, Japanese inflation, Jackson Hole, US Treasury yields and Fed policy expectations.
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Global markets turned their attention firmly toward central-bank policy as traders positioned ahead of Fed Chair Kevin Warsh’s highly anticipated Jackson Hole address. Gold recovered from its recent pullback as softer US Treasury yields provided support, although sticky US inflation continued to keep Fed rate-hike expectations alive. Across currencies, the Australian Dollar remained supported by expectations for further RBA tightening, while the South Korean Won strengthened following a second consecutive Bank of Korea rate increase. The Euro also found support from a more hawkish ECB outlook, while the New Zealand Dollar slipped toward 0.5950 as stronger US inflation reinforced expectations that US rates could remain elevated. With several major central banks leaning toward tighter policy, interest-rate expectations have become the dominant force shaping today’s market direction.
Gold regained positive momentum during Thursday’s Asian session, reversing much of its previous decline toward $4,583. Softer US Treasury yields, partly driven by the Treasury’s bond-buyback strategy, provided support for the non-yielding metal. However, Gold remains below its recent three-month high as traders await Fed Chair Warsh’s Jackson Hole speech for clearer guidance on the future path of US interest rates.
• Jackson Hole: Warsh’s upcoming speech represents the key catalyst for expectations surrounding Fed policy.
• Treasury Yields: Lower US yields are helping Gold recover by reducing the opportunity cost of holding bullion.
• US Inflation: July headline PCE remained at 3.7%, slightly above expectations, keeping Fed tightening risks alive.
• US Dollar: Any renewed Dollar strength could limit Gold’s upside.
• Geopolitical Risks: Uncertainty surrounding the US-Iran situation continues to provide some underlying safe-haven support.
• Trend: Bullish
• Resistance: $4,700
• Support: $4,525 – $4,515
• Forecast: Gold retains a constructive bias while holding above the $4,525-$4,515 support zone. A sustained break through $4,700 could strengthen bullish momentum and expose the next Fibonacci resistance around $4,861. However, a hawkish message from Warsh could lift yields and the Dollar, triggering another correction.
• Market Sentiment: Cautiously bullish ahead of Jackson Hole.
• Catalysts: Warsh’s speech, Fed rate expectations, Treasury yields, US Dollar direction and geopolitical developments.
The South Korean Won strengthened against the US Dollar, with USD/KRW falling toward 1,380, near an 11-month low. The Bank of Korea raised its policy rate by 25 basis points to 3.00%, marking another consecutive hike as policymakers continued their effort to bring inflation back toward target.
• BoK Rate Hike: Higher interest rates are increasing the Won’s relative attractiveness.
• Inflation: South Korean inflation eased to 2.8% in July but remains above the BoK’s 2% target.
• Growth Outlook: The BoK upgraded its 2026 growth forecast to 3.3% from 2.6%.
• Investment Flows: Strong interest in South Korea’s semiconductor and AI sectors has supported KRW demand.
• US Dollar: Sticky US inflation provides some support for USD and could limit further KRW appreciation.
• Trend: Bearish USD/KRW
• Resistance: 1,400
• Support: 1,370
• Forecast: USD/KRW could remain under downward pressure as higher Korean interest rates and strong capital flows support the Won. However, the currency’s significant year-to-date appreciation means the risk of short-term consolidation is increasing.
• Market Sentiment: Bullish for KRW.
• Catalysts: BoK policy expectations, Korean inflation, semiconductor investment flows, US Dollar direction and Jackson Hole.
The New Zealand Dollar slipped toward 0.5950 as hotter US headline PCE inflation strengthened expectations that the Federal Reserve could raise interest rates again. Headline PCE remained at 3.7% year-over-year in July, slightly above the 3.6% forecast, while core inflation held at 3.3%.
• US Inflation: Persistent price pressures are supporting expectations for tighter Fed policy.
• Fed Expectations: Markets continue to price some probability of another rate increase, supporting USD.
• Jackson Hole: Warsh’s comments could significantly reshape the outlook for NZD/USD.
• RBNZ Policy: Expectations for another RBNZ hike provide underlying support for NZD.
• Risk Sentiment: As a risk-sensitive currency, NZD remains vulnerable to more defensive global positioning.
• Trend: Neutral to Bullish
• Resistance: 0.5985
• Support: 0.5905
• Forecast: Despite the current pullback, NZD/USD retains a constructive technical structure above its 100-day SMA. A recovery above 0.5985 could bring 0.6000 into focus, while a break below 0.5905 would increase the risk of a deeper correction toward 0.5845.
• Market Sentiment: Cautious in the near term.
• Catalysts: Jackson Hole, Fed expectations, RBNZ policy, US Treasury yields and global risk sentiment.
The Australian Dollar remained one of the stronger major currencies as hotter domestic inflation reinforced expectations that the Reserve Bank of Australia could tighten policy further. AUD/USD has recently traded around 0.7170-0.7180, with Australian inflation providing enough support to offset renewed hawkish expectations surrounding the Fed.
• Australian Inflation: Stronger-than-expected CPI has increased expectations for another RBA hike.
• RBA Policy: Markets are increasingly considering additional tightening as inflation remains persistent.
• US Inflation: Sticky PCE data supports the Dollar and limits the Aussie’s upside.
• Australian Economy: Softer domestic investment and labor indicators could complicate the RBA outlook.
• Jackson Hole: Warsh’s message could determine whether AUD/USD can maintain its recent momentum.
• Trend: Bullish
• Resistance: 0.7200
• Support: 0.7085
• Forecast: AUD/USD could challenge the psychological 0.7200 level if RBA tightening expectations remain elevated. A hawkish Jackson Hole message from the Fed could slow the advance, while continued strength above roughly 0.7085 would preserve the broader constructive outlook.
• Market Sentiment: Moderately bullish.
• Catalysts: RBA rate expectations, Australian economic data, Fed policy signals, Jackson Hole and US Dollar direction.
The Euro held above 1.1650 as increasingly hawkish expectations surrounding the European Central Bank provided support. Markets are considering the possibility of further ECB tightening as persistent geopolitical pressures and a stronger-than-expected Eurozone economy create upside risks to inflation.
• ECB Expectations: Markets increasingly expect European interest rates to remain restrictive or move higher.
• Eurozone Inflation: Persistent inflation risks strengthen the argument for additional tightening.
• Economic Resilience: Stronger-than-expected Eurozone activity is giving the ECB greater room to maintain a hawkish stance.
• Fed Policy: The relative ECB-Fed outlook remains crucial for EUR/USD.
• Jackson Hole: Warsh’s speech could create substantial Dollar volatility and determine the pair’s next move.
• Trend: Neutral to Bullish
• Resistance: 1.1700
• Support: 1.1600
• Forecast: EUR/USD could remain supported while markets maintain expectations for tighter ECB policy. A sustained break above 1.1700 would strengthen the bullish outlook, while a hawkish shift from the Fed could push the pair back toward 1.1600.
• Market Sentiment: Cautiously bullish.
• Catalysts: ECB policy expectations, ECB Meeting Accounts, Eurozone inflation, Jackson Hole, Fed expectations and US Treasury yields.
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Global markets shifted their attention toward inflation and monetary-policy expectations as signs of progress in Middle East diplomacy helped ease some of the geopolitical pressure that had dominated recent sessions. WTI crude retreated as concerns over immediate supply disruptions faded, while the Australian Dollar strengthened after hotter-than-expected inflation kept the prospect of further RBA tightening alive. Precious metals remained firm, with Gold approaching $4,700 and Silver holding above $69 as traders positioned ahead of the US PCE inflation report. Meanwhile, the Japanese Yen gained support from lower US yields and growing expectations that the Bank of Japan could raise rates in September. With the Fed’s preferred inflation gauge now taking center stage, today’s data could significantly reshape expectations for the next moves in global interest rates.
The Australian Dollar strengthened for a second consecutive session, with AUD/USD climbing toward 0.7170 after Australia’s latest inflation report came in hotter than expected. Annual CPI eased to 3.5% in July from 3.8%, but remained well above the 3.2% market forecast, reinforcing expectations that the RBA may need to maintain a restrictive policy stance.
• Australian Inflation: CPI exceeding expectations strengthens the case for maintaining tighter monetary policy.
• RBA Expectations: Persistent inflation keeps the possibility of additional RBA tightening on the table.
• US PCE: Today’s US inflation report could significantly influence the Dollar side of AUD/USD.
• US Yields: Sliding Treasury yields have helped limit demand for the Greenback.
• Risk Sentiment: Hopes for progress in Middle East diplomacy are providing a more supportive environment for the risk-sensitive Aussie.
• Trend: Bullish
• Resistance: 0.7200
• Support: 0.7100
• Forecast: AUD/USD could extend its advance toward the psychological 0.7200 area if US PCE data reinforces expectations for a less hawkish Fed. A stronger-than-expected PCE reading, however, could revive Dollar demand and trigger consolidation.
• Market Sentiment: Moderately bullish following the hotter Australian CPI report.
• Catalysts: US PCE inflation, RBA expectations, Fed policy outlook, Treasury yields and Middle East developments.
WTI crude came under renewed selling pressure as diplomatic developments in the Middle East reduced fears of immediate supply disruptions. Iran and Oman have been discussing arrangements surrounding the Strait of Hormuz, helping ease some of the geopolitical premium previously embedded in energy prices. FXStreet’s broader market coverage also notes that easing oil prices are reducing inflation concerns ahead of US PCE.
• Middle East Diplomacy: Progress toward easing tensions reduces immediate fears of supply disruption.
• Hormuz Outlook: Developments surrounding shipping through the Strait remain critical for crude prices.
• Sanctions: Markets continue assessing the potential impact of US sanctions involving Iran.
• Inflation: Falling crude prices could help reduce broader energy-driven inflation pressures.
• Global Demand: Once geopolitical premiums fade, underlying demand expectations become increasingly important.
• Trend: Bearish to Neutral
• Resistance: $83.00
• Support: $79.00
• Forecast: WTI could remain under pressure if diplomatic progress continues and concerns over supply disruptions diminish. A sustained move below $80 could reinforce the bearish bias, while renewed geopolitical tensions could quickly restore the risk premium.
• Market Sentiment: Cautiously bearish as geopolitical premiums unwind.
• Catalysts: Iran-Oman negotiations, Strait of Hormuz developments, US sanctions, inventories and global demand expectations.
Gold returned toward its recent 15-week highs, trading just below $4,700, as a broadly subdued US Dollar and declining Treasury yields supported demand. Traders are now focused heavily on the US Core PCE Price Index, the Federal Reserve’s preferred inflation gauge, for clues about the future path of monetary policy.
• US PCE: Inflation data represents the most important near-term catalyst for Gold.
• Fed Expectations: Softer inflation could reduce expectations for tighter policy and benefit non-yielding bullion.
• US Dollar: Continued Dollar weakness remains supportive.
• Treasury Yields: Lower yields reduce the opportunity cost of holding Gold.
• Geopolitical Risks: Easing Middle East tensions could reduce some safe-haven demand, although uncertainty has not disappeared.
• Trend: Bullish
• Resistance: $4,700
• Support: $4,630
• Forecast: Gold could challenge the psychologically important $4,700 level if PCE data weakens the Dollar and Treasury yields. However, FXStreet notes that daily technical conditions are already overbought, increasing the possibility of profit-taking if inflation surprises to the upside.
• Market Sentiment: Bullish but technically stretched.
• Catalysts: US PCE inflation, Fed expectations, Treasury yields, Dollar direction and Middle East diplomacy.
The Japanese Yen strengthened as lower US bond yields and Treasury buyback developments pressured the Dollar, while expectations for further Bank of Japan tightening provided additional support. A Reuters poll highlighted by FXStreet shows economists expecting the BoJ to raise its policy rate to 1.25% in September, adding a potentially important domestic catalyst for JPY.
• BoJ Expectations: Growing expectations for a September rate increase are supportive for the Yen.
• US Treasury Yields: Lower yields reduce the attractiveness of USD relative to JPY.
• Treasury Buybacks: US bond-buyback plans have contributed to downward pressure on longer-term yields.
• US PCE: Inflation data could reshape expectations for the Fed and therefore US-Japan yield differentials.
• Intervention Risk: Elevated USD/JPY levels continue to make traders sensitive to potential action from Japanese authorities.
• Trend: Neutral to Bearish USD/JPY
• Resistance: 159.50
• Support: 157.50
• Forecast: USD/JPY could remain under downward pressure if expectations for BoJ tightening strengthen while US yields decline. Softer US PCE would reinforce that setup, while hotter inflation could restore support for USD and slow the Yen’s recovery.
• Market Sentiment: Moderately bullish for JPY.
• Catalysts: US PCE, BoJ expectations, Treasury yields, Fed policy expectations and Japanese intervention signals.
Silver remained firmly elevated above the $69 region following its powerful recent advance. Like Gold, the metal is benefiting from subdued Dollar conditions and changing expectations surrounding US monetary policy, although elevated volatility means traders remain sensitive to any surprise from the PCE inflation report.
• US Inflation: PCE could determine whether recent expectations for a softer Fed stance persist.
• US Dollar: Continued weakness in the Greenback supports Dollar-denominated metals.
• Treasury Yields: Lower yields improve the relative attractiveness of non-yielding precious metals.
• Gold Momentum: Strength in Gold continues to provide a supportive backdrop for the broader precious-metals complex.
• Industrial Demand: Silver’s industrial role means broader economic expectations remain an additional driver.
• Trend: Bullish
• Resistance: $70.00
• Support: $67.50
• Forecast: Silver could challenge the psychologically important $70.00 level if softer US inflation extends the decline in yields and the Dollar. However, after its rapid advance, a hotter PCE print could trigger substantial profit-taking and heightened volatility.
• Market Sentiment: Bullish but volatile.
• Catalysts: US PCE inflation, Fed expectations, Dollar direction, Treasury yields, Gold performance and global industrial demand.
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Global markets traded cautiously as investors balanced renewed geopolitical risks with shifting expectations for monetary policy across major economies. WTI remained elevated above $84.50 as tougher US sanctions on Iran kept potential supply disruptions in focus, while the Australian Dollar steadied following the RBA Meeting Minutes and the Euro found support from relatively hawkish ECB expectations. Meanwhile, the Japanese Yen remained vulnerable around 159.00 against the US Dollar, and Gold retreated after approaching the $4,700 level as renewed Fed risks provided some support to the Greenback. With geopolitical tensions, inflation pressures and central-bank expectations pulling markets in different directions, volatility could remain elevated across commodities and major currency pairs.
WTI crude oil held above $84.50 as traders continued assessing the potential impact of tougher US sanctions against Iran. Concerns that additional restrictions could affect Iranian crude exports kept a geopolitical risk premium embedded in oil prices, although uncertainty over actual supply disruptions prevented a more decisive advance.
• US-Iran Relations: Escalating sanctions remain the primary geopolitical driver for crude prices.
• Supply Risks: Restrictions on Iranian exports could tighten global supply if enforcement significantly reduces available barrels.
• Inflation Risks: Persistently elevated oil prices could contribute to renewed inflation pressures across major economies.
• US Dollar: Dollar direction remains important for commodities priced in USD.
• Global Demand: Concerns surrounding economic growth could limit the upside even if geopolitical risks remain elevated.
• Trend: Moderately Bullish
• Resistance: $85.50
• Support: $83.50
• Forecast: WTI could maintain its bullish bias while holding above the $83.50 support region. A sustained break above $85.50 could encourage further gains, although signs of diplomatic progress or limited disruption to Iranian supply could trigger renewed profit-taking.
• Market Sentiment: Cautiously bullish as supply concerns offset uncertainty surrounding global demand.
• Catalysts: US sanctions on Iran, Middle East developments, OPEC+ signals, crude inventories and global demand expectations.
The Australian Dollar remained relatively steady following the release of the RBA Meeting Minutes as traders assessed the central bank’s outlook for inflation and future interest rates. Policymakers’ willingness to respond if inflationary pressures remain persistent provided some underlying support for the Aussie, although recent weakness in Australia’s labor market continued to limit stronger buying.
• RBA Policy: Markets are assessing whether persistent inflation could require additional monetary tightening.
• Australian Economy: Recent labor-market weakness creates uncertainty over how much room the RBA has to tighten further.
• Inflation: Persistent price pressures remain central to the RBA’s policy outlook.
• China Outlook: Chinese economic conditions remain important given Australia’s strong trade exposure.
• US Dollar: Shifting Fed expectations continue influencing the other side of AUD/USD.
• Trend: Neutral to Bullish
• Resistance: 0.7150
• Support: 0.7050
• Forecast: AUD/USD could retain a constructive bias while RBA expectations remain relatively hawkish. A sustained move above 0.7150 would strengthen the upside outlook, while renewed concerns about Australia’s labor market could bring 0.7050 back into focus.
• Market Sentiment: Cautiously bullish, with RBA support offset by domestic growth concerns.
• Catalysts: RBA commentary, Australian inflation and employment data, Chinese developments and US Dollar direction.
The Euro found support as expectations for a relatively hawkish ECB policy outlook combined with subdued US Dollar demand. Persistent energy-related inflation risks have complicated the European inflation picture, potentially encouraging the ECB to maintain a restrictive stance for longer than previously anticipated.
• ECB Expectations: Hawkish policy expectations remain supportive for the Euro.
• Inflation Risks: Elevated energy costs could maintain inflationary pressure across the Eurozone.
• US Dollar: A subdued Greenback provides additional support for EUR/USD.
• Economic Growth: Concerns surrounding Eurozone growth could limit the impact of hawkish ECB expectations.
• Geopolitical Risks: Middle East developments remain important through their potential impact on energy prices and inflation.
• Trend: Moderately Bullish
• Resistance: 1.1750
• Support: 1.1650
• Forecast: EUR/USD could maintain its upside bias while ECB expectations remain supportive and the Dollar stays subdued. A sustained break above 1.1750 could encourage further gains, while failure to hold 1.1650 would weaken the bullish structure.
• Market Sentiment: Cautiously bullish.
• Catalysts: ECB commentary, Eurozone inflation, energy prices, Fed expectations and geopolitical developments.
The Japanese Yen remained under pressure as USD/JPY consolidated around the 159.00 region. Persistent interest-rate differentials and concerns surrounding Japan’s economic backdrop continued to weigh on the Yen, leaving the currency vulnerable despite expectations that the Bank of Japan could gradually normalize monetary policy.
• Rate Differentials: The gap between US and Japanese yields remains an important structural headwind for JPY.
• BoJ Policy: Expectations for additional policy normalization could help prevent a deeper Yen decline.
• Japanese Economy: Trade and import-cost pressures remain important for the currency outlook.
• Fed Expectations: Renewed expectations for tighter US policy could strengthen USD/JPY.
• Intervention Risk: Continued Yen weakness near elevated USD/JPY levels could increase market sensitivity to Japanese authorities.
• Trend: Bullish USD/JPY
• Resistance: 160.00
• Support: 158.00
• Forecast: USD/JPY could remain supported while holding above 158.00, with 160.00 representing the next important psychological resistance. However, further Yen weakness could increase intervention concerns and limit aggressive upside positioning.
• Market Sentiment: Bearish for JPY but increasingly cautious near psychologically important levels.
• Catalysts: BoJ commentary, Fed expectations, Treasury yields, Japanese economic data and intervention signals.
Gold retreated after approaching the $4,700 level and reaching its strongest area since mid-May. Renewed support for the US Dollar and uncertainty surrounding the Federal Reserve’s policy outlook encouraged some profit-taking, although geopolitical risks and concerns surrounding the US fiscal outlook continued to provide underlying support for bullion.
• Fed Expectations: Renewed tightening risks represent a headwind for non-yielding Gold.
• US Dollar: A firmer Greenback could limit Gold’s ability to extend recent gains.
• Geopolitical Risks: US-Iran tensions continue providing underlying safe-haven demand.
• US Fiscal Concerns: Continued attention on debt and Treasury-market conditions supports Gold’s defensive appeal.
• Inflation: Elevated energy prices could increase inflation-hedging demand, although they may simultaneously strengthen expectations for tighter monetary policy.
• Trend: Bullish with Near-Term Consolidation Risk
• Resistance: $4,700
• Support: $4,600
• Forecast: Gold could consolidate following its strong advance, with $4,700 remaining the key barrier for bulls. Holding above $4,600 would preserve the broader bullish structure, while a decisive break through $4,700 could open another leg higher.
• Market Sentiment: Cautiously bullish despite near-term profit-taking.
• Catalysts: Fed expectations, Dollar direction, Treasury yields, US fiscal developments, inflation expectations and US-Iran tensions.
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Global markets opened the week with major currencies holding firm as continued US Dollar weakness reshaped momentum across FX markets. The Swiss Franc advanced amid concerns surrounding the US debt outlook and increased Treasury bond buybacks, while Sterling remained close to recent highs and the Euro held steady against the Greenback. The Canadian Dollar faced competing forces from US-Canada trade tensions and a softer USD, while WTI crude slipped below $85.00 as traders took profits ahead of new US sanctions on Iran. With fiscal concerns, trade policy and geopolitical developments all in focus, markets remain sensitive to any catalyst capable of changing the Dollar’s current trajectory.
WTI crude oil slipped below $85.00 as traders locked in profits following its recent advance. Markets are also positioning ahead of new US sanctions targeting Iran, with uncertainty surrounding their potential impact on Iranian supply and global energy flows keeping volatility elevated.
• US-Iran Relations: New US sanctions could increase pressure on Iranian crude exports and support supply-risk premiums.
• Profit-Taking: Recent gains encouraged traders to reduce positions, contributing to the latest pullback.
• Supply Risks: Any disruption to Iranian exports or regional shipping routes could quickly tighten sentiment.
• US Dollar: Continued Dollar weakness could provide underlying support for Dollar-denominated commodities.
• Global Demand: Traders continue to balance geopolitical supply risks against the broader demand outlook.
• Trend: Neutral to Bullish
• Resistance: $85.50
• Support: $83.50
• Forecast: WTI could consolidate below $85.00 following the recent profit-taking. However, uncertainty surrounding new US sanctions on Iran may keep downside pressure contained, with renewed supply concerns potentially allowing buyers to challenge $85.50 again.
• Market Sentiment: Cautiously bullish despite the near-term pullback.
• Catalysts: US sanctions on Iran, Middle East developments, crude inventories, OPEC+ signals and global demand expectations.
The Canadian Dollar remained caught between competing fundamental forces. US-Canada trade tensions continued to create downside risks for CAD, but persistent US Dollar weakness prevented sellers from gaining stronger control. Changes in crude oil prices added another layer of uncertainty for the commodity-linked currency.
• US-Canada Trade Relations: Trade-war concerns remain a significant headwind for the Canadian economy and CAD.
• US Dollar: Continued Greenback weakness is limiting upside pressure on USD/CAD.
• Oil Prices: The retreat in WTI could reduce some support for the Canadian Dollar.
• Fed Expectations: Softer expectations surrounding US monetary policy continue weighing on USD.
• Bank of Canada: Relative Fed-BoC rate expectations remain important for the pair.
• Trend: Neutral
• Resistance: 1.3900
• Support: 1.3800
• Forecast: USD/CAD may remain caught in consolidation as weak USD demand offsets trade-related pressure on the Canadian Dollar. A further decline in oil could favor the upside, while renewed Dollar selling could keep the pair under pressure.
• Market Sentiment: Neutral amid conflicting drivers.
• Catalysts: US-Canada trade developments, crude oil prices, Fed and BoC expectations and North American economic data.
The Swiss Franc strengthened as renewed selling pressure hit the US Dollar amid concerns surrounding US debt-management strategy and increased Treasury bond buybacks. The Franc’s defensive characteristics also helped attract demand as investors reassessed exposure to US assets.
• US Debt Concerns: Fiscal uncertainty continues to undermine confidence in the Greenback.
• Treasury Buybacks: Increased US government bond buybacks have drawn attention to debt-management strategy.
• Safe-Haven Demand: CHF continues to benefit from demand for defensive alternatives.
• Fed Expectations: Reduced expectations for aggressive US tightening remain a headwind for USD.
• SNB Policy: Swiss monetary-policy expectations remain an important secondary driver.
• Trend: Bearish USD/CHF
• Resistance: 0.8050
• Support: 0.7950
• Forecast: USD/CHF could remain under pressure while concerns surrounding US debt and continued Dollar weakness support the Franc. A sustained break below 0.7950 could strengthen the bearish outlook, while a recovery above 0.8050 would signal improving Dollar momentum.
• Market Sentiment: Moderately bearish for USD/CHF.
• Catalysts: US fiscal developments, Treasury-market activity, Fed expectations, SNB policy and broader safe-haven demand.
The British Pound held near its February 11 highs against the US Dollar, with GBP/USD trading close to 1.3650 as buyers looked for a decisive breakout above 1.3660. Continued Greenback weakness provided support, although traders remained cautious about chasing the pair significantly higher without technical confirmation.
• US Dollar: Persistent Dollar weakness remains the primary tailwind for GBP/USD.
• Technical Momentum: The 1.3660 region represents an important near-term breakout level.
• BoE Expectations: UK monetary-policy expectations continue influencing Sterling.
• Fed Outlook: Reduced expectations for aggressive Fed tightening weaken USD’s relative rate advantage.
• Risk Sentiment: Broader market confidence could determine whether Sterling attracts further buying.
• Trend: Bullish
• Resistance: 1.3660 / 1.3700
• Support: 1.3570
• Forecast: GBP/USD could extend its advance if bulls achieve a sustained breakout above 1.3660, potentially bringing 1.3700 into focus. Failure to clear resistance could trigger consolidation after the pair’s recent gains.
• Market Sentiment: Moderately bullish.
• Catalysts: Dollar direction, Fed expectations, Bank of England commentary, UK economic data and the 1.3660 technical breakout.
The Euro held relatively steady against the US Dollar as investors continued assessing developments surrounding the US government’s debt strategy. Continued weakness in the Greenback helped EUR/USD maintain recent gains, although buyers remained cautious following the pair’s recent advance.
• US Debt Strategy: Concerns surrounding government borrowing and Treasury-market management continue weighing on USD sentiment.
• US Dollar: Persistent Greenback weakness remains supportive for the Euro.
• Fed Expectations: Reduced expectations for further aggressive tightening favor EUR/USD.
• ECB Outlook: European monetary-policy expectations remain important for the Euro’s underlying direction.
• Risk Sentiment: Broader uncertainty may prevent investors from aggressively extending long positions.
• Trend: Neutral to Bullish
• Resistance: 1.1750
• Support: 1.1650
• Forecast: EUR/USD could retain its constructive bias while the Dollar remains under pressure. A sustained move above 1.1750 could open further upside, while failure to build momentum may keep the pair consolidating above 1.1650.
• Market Sentiment: Cautiously bullish.
• Catalysts: US debt developments, Fed expectations, ECB commentary, Treasury yields and upcoming economic data.
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Precious metals took center stage as renewed US Dollar weakness and growing concerns over the US fiscal outlook encouraged investors to seek alternatives across global markets. Gold climbed to its highest level since early June around $4,544, while Silver surged toward $69.00 amid heightened volatility in currency and bond markets. The Dollar remained near a three-month low as traders scaled back immediate Fed hike expectations, helping the Swiss Franc and Australian Dollar strengthen. However, elevated oil prices and persistent US-Iran tensions continue to pose inflation risks, potentially limiting how far the Dollar can fall and how far metals can rally.
The US Dollar Index remained near its lowest level in more than three months as fading expectations for an immediate Federal Reserve rate hike continued to weigh on the Greenback. Geopolitical uncertainty and inflation risks from higher energy prices, however, are providing some support and preventing a more aggressive selloff.
• Fed Expectations: Reduced expectations for an immediate rate increase remain a major headwind for USD.
• US Fiscal Concerns: Treasury debt-management measures and concerns about the broader fiscal outlook have pressured confidence in the Dollar.
• Geopolitical Risks: The US-Iran standoff continues to generate some safe-haven demand.
• Inflation Risks: Higher energy prices could keep inflation elevated and support Treasury yields.
• US Data: Upcoming economic releases could determine whether markets continue reducing Fed tightening expectations.
• Trend: Bearish
• Resistance: 99.16 – 99.22
• Support: 98.50
• Forecast: DXY could remain under pressure while trading beneath its 200-day SMA around 99.16. A sustained recovery above the 99.16–99.22 resistance region would be needed to weaken the bearish outlook, while failure to recover could expose the Dollar to another test of recent lows.
• Market Sentiment: Bearish, although geopolitical and inflation risks warrant caution.
• Catalysts: Fed expectations, US economic data, Treasury yields, fiscal developments and US-Iran tensions.
The Swiss Franc strengthened against the US Dollar, pushing USD/CHF toward 0.7990 as concerns surrounding US government debt reduced the appeal of the Greenback. The pair remains under its 20-day EMA, reinforcing the near-term bearish technical structure.
• US Debt Concerns: Growing fiscal concerns are weighing on confidence in USD.
• Safe-Haven Demand: The Swiss Franc continues to benefit from its defensive characteristics.
• Treasury Market: Recent US Treasury buyback announcements have increased attention on borrowing costs and debt sustainability.
• Fed Expectations: Reduced expectations for immediate tightening are limiting Dollar support.
• SNB Outlook: Relative Fed-SNB policy expectations remain important for the pair.
• Trend: Bearish USD/CHF
• Resistance: 0.8080
• Support: 0.7990 / 0.7922
• Forecast: USD/CHF could remain under pressure while trading below the 20-day EMA at 0.8080. A sustained break below 0.7990 could expose the 0.7922 area, while a recovery above 0.8080 would begin to ease the bearish bias.
• Market Sentiment: Moderately bearish for USD/CHF.
• Catalysts: US fiscal developments, Treasury yields, Fed expectations, SNB policy and global risk sentiment.
The Australian Dollar advanced above 0.7100, with AUD/USD trading near 0.7135 as renewed US Dollar weakness provided support. However, Australia’s recent labor-market weakness could limit the upside after employment unexpectedly fell and unemployment increased to 4.5%.
• US Dollar: Continued Greenback weakness remains the primary near-term source of support.
• US Debt Concerns: Fiscal uncertainty is contributing to broader USD selling.
• Australian Labor Market: Weak employment figures could reduce expectations for further RBA tightening.
• RBA Policy: A softer labor market strengthens the argument for a policy pause.
• Risk Sentiment: AUD remains sensitive to broader appetite for risk and developments in China.
• Trend: Bullish
• Resistance: 0.7150
• Support: 0.7070 / 0.7055
• Forecast: AUD/USD could extend its advance toward 0.7150 while Dollar weakness persists. Momentum is becoming stretched, however, meaning failure to clear resistance could trigger consolidation toward the 0.7070–0.7055 support region.
• Market Sentiment: Moderately bullish but approaching stretched technical conditions.
• Catalysts: US Dollar direction, RBA expectations, Australian labor-market developments, US data and China-related sentiment.
Gold surged to a fresh high since early June around $4,544 as continued Dollar weakness and reduced expectations for an immediate Fed hike boosted demand for the non-yielding metal. Gold has also moved above its 200-day SMA, strengthening its constructive technical setup.
• US Dollar: A weaker Greenback remains a major tailwind for Gold.
• Fed Expectations: Reduced immediate rate-hike expectations increase the appeal of non-yielding bullion.
• Geopolitical Risks: Persistent US-Iran tensions maintain underlying safe-haven demand.
• Inflation Risks: Higher oil prices could simultaneously support Gold as an inflation hedge while increasing the risk of tighter Fed policy.
• Treasury Yields: Elevated yields remain one of the key factors that could limit stronger gains.
• Trend: Bullish
• Resistance: $4,687
• Support: $4,529 / $4,514
• Forecast: Gold retains a bullish near-term bias after establishing itself above the 200-day SMA. Sustained strength above roughly $4,529 could keep the path open toward $4,687, although momentum is approaching overbought territory and could produce short-term consolidation.
• Market Sentiment: Bullish, but increasingly stretched.
• Catalysts: Dollar direction, Fed expectations, Treasury yields, US-Iran developments and energy-driven inflation risks.
Silver extended its rally for a third consecutive session, trading around $68.70 and approaching the psychologically important $69.00 area. The metal has gained nearly 6% this week as investors responded to volatility across global bond and currency markets and persistent weakness in the US Dollar.
• US Dollar: Dollar weakness continues to provide significant support for Silver.
• Safe-Haven Demand: Volatility in currency and bond markets is increasing demand for precious metals.
• US Fiscal Concerns: Treasury debt-management developments have contributed to uncertainty in bond markets.
• Geopolitical Risks: US-Iran tensions provide additional defensive demand.
• Inflation and Rates: Higher oil prices could raise inflation expectations and revive rate-hike concerns, potentially limiting further upside.
• Trend: Strongly Bullish
• Resistance: $69.00 / $70.00
• Support: $67.00
• Forecast: Silver could challenge $69.00 and potentially the psychological $70.00 level if momentum and Dollar weakness persist. However, the rapid weekly advance increases the risk of profit-taking and short-term volatility near current levels.
• Market Sentiment: Bullish but highly volatile.
• Catalysts: Dollar performance, US fiscal developments, Fed expectations, oil prices, geopolitical risks and precious-metal demand.
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Major currency markets moved in different directions as investors responded to a fresh round of domestic and regional economic signals. The Australian Dollar weakened after disappointing labor data showed unemployment rising to 4.5%, while the Japanese Yen remained under pressure as Japan’s trade deficit widened and import costs increased. Sterling and the Euro also edged lower, although fading expectations for further Federal Reserve tightening helped limit their downside. In contrast, the New Zealand Dollar strengthened toward 0.5950, supported by a relatively hawkish RBNZ backdrop, softer US inflation and China’s decision to keep its key lending rates unchanged.
The Australian Dollar came under pressure following weaker-than-expected employment figures. Australia’s unemployment rate climbed to 4.5% in July from 4.4% in June, reinforcing concerns that labor-market conditions may be losing momentum. The weak report initially weighed on the Aussie, although lingering RBA concerns about inflation could help limit deeper losses.
• Australian Labor Market: Rising unemployment is weighing on confidence in the domestic outlook.
• RBA Policy: Persistent inflation concerns could prevent markets from becoming overly dovish on the RBA.
• US Dollar: USD direction remains an important secondary influence on AUD/USD.
• China Outlook: Developments in China remain significant given Australia’s trade exposure.
• Risk Sentiment: AUD remains particularly sensitive to shifts in global appetite for risk.
• Trend: Neutral to Bearish
• Resistance: 0.7100
• Support: 0.7020
• Forecast: AUD/USD could remain under pressure as traders digest weaker employment conditions. However, a still-cautious RBA inflation stance may help prevent a deeper selloff, making the 0.7020 area important for maintaining the broader structure.
• Market Sentiment: Cautiously bearish.
• Catalysts: Australian labor data follow-through, RBA commentary, Chinese developments and US economic releases.
The British Pound edged lower as the US Dollar stabilized after its recent decline. Sterling’s downside nevertheless appeared limited as markets continued reassessing the outlook for US interest rates, while recent Dollar weakness remained an underlying source of support for GBP/USD.
• US Dollar: Stabilization in USD is creating near-term resistance for Sterling.
• Fed Expectations: Reduced expectations for further aggressive tightening could limit Dollar upside.
• BoE Policy: UK rate expectations remain an important source of support for GBP.
• UK Economy: Incoming growth, inflation and labor-market figures will influence the BoE outlook.
• Risk Sentiment: Broader FX positioning remains cautious following recent volatility.
• Trend: Neutral to Bullish
• Resistance: 1.3600
• Support: 1.3500
• Forecast: GBP/USD may consolidate after its recent gains, with the downside likely to remain contained while the Dollar struggles to establish a stronger recovery. A sustained move above 1.3600 would improve the bullish outlook.
• Market Sentiment: Neutral with a modest bullish bias.
• Catalysts: Bank of England expectations, US data, Fed commentary and UK economic releases.
The Euro edged below the 1.1700 level despite fading expectations for further Federal Reserve tightening. The pair remained close to recent elevated levels, suggesting that the latest decline represented consolidation rather than a decisive reversal in the broader trend. Current FXStreet market data also showed EUR/USD posting modest losses around the upper 1.16 region.
• Fed Expectations: Fading US rate-hike expectations remain supportive for EUR/USD over the broader horizon.
• US Dollar: Short-term stabilization in USD is limiting further Euro gains.
• ECB Outlook: Expectations surrounding European monetary policy remain important for EUR direction.
• Economic Data: Eurozone growth and inflation releases could determine whether recent strength continues.
• Risk Sentiment: Cautious positioning may keep the pair in consolidation.
• Trend: Neutral to Bullish
• Resistance: 1.1720
• Support: 1.1650
• Forecast: EUR/USD could remain in consolidation below 1.1700 in the near term. Holding above 1.1650 would preserve the constructive outlook, while a decisive break through 1.1720 could reopen the path toward fresh highs.
• Market Sentiment: Cautiously bullish despite the short-term pullback.
• Catalysts: ECB commentary, Fed expectations, Eurozone economic releases and US data.
The Japanese Yen remained under pressure as Japan’s trade position deteriorated. The country’s trade deficit widened to ¥634.5 billion in July from ¥409.9 billion previously, marking a third consecutive monthly deficit as imports grew faster than exports. Rising import and energy costs are also creating additional pressure on the currency.
• Trade Balance: A widening deficit represents a fundamental headwind for JPY.
• Import Costs: Higher energy and import prices increase Japan’s demand for foreign currencies.
• BoJ Expectations: Prospects for future policy normalization could provide some support to the Yen.
• Rate Differentials: Wide international yield differentials remain a structural challenge for JPY.
• US Dollar: USD direction continues to determine the other side of the pair.
• Trend: Bullish USD/JPY
• Resistance: 160.00
• Support: 158.50
• Forecast: USD/JPY could remain supported while Japan’s trade and import-cost pressures persist. However, expectations for additional BoJ tightening may limit the upside as the pair approaches psychologically important levels.
• Market Sentiment: Bearish for JPY.
• Catalysts: Japanese inflation, BoJ expectations, trade developments, energy prices and US Treasury yields.
The New Zealand Dollar strengthened toward 0.5950, trading near a two-and-a-half-month high. The Kiwi benefited from a relatively hawkish RBNZ tone and softer US inflation, while China’s decision to leave its key lending rates unchanged provided additional stability for currencies closely linked to the Chinese economy.
• China Policy: Unchanged lending rates provided a stable backdrop for China-sensitive currencies.
• RBNZ Outlook: A relatively hawkish policy tone remains supportive for NZD.
• US Dollar: Softer US inflation has reduced some of the monetary-policy support previously enjoyed by USD.
• Risk Sentiment: Improved appetite for risk-sensitive currencies favors the Kiwi.
• China-New Zealand Link: China remains an important trading partner, making Chinese policy and growth developments particularly relevant for NZD.
• Trend: Bullish
• Resistance: 0.6000
• Support: 0.5900
• Forecast: NZD/USD could continue challenging recent highs while holding above 0.5900. A sustained break through 0.5950 would bring the psychologically important 0.6000 area into focus, although renewed Dollar strength could slow the advance.
• Market Sentiment: Bullish as NZD approaches multi-month highs.
• Catalysts: RBNZ commentary, Chinese economic developments, US data and global risk appetite.
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Global markets adopted a defensive tone as investors awaited the Federal Reserve’s latest meeting minutes while renewed US-Iran tensions kept geopolitical uncertainty elevated. The US Dollar held above 99.50 on safe-haven demand, weighing on risk-sensitive currencies including the New Zealand and Australian Dollars, while the Canadian Dollar consolidated as traders also watched developments around US tariffs. In the UK, inflation returned to focus as higher energy costs were expected to push CPI to a four-month high, potentially influencing the Bank of England’s rate outlook.
The US Dollar Index held above 99.50 as escalating concerns surrounding Iran and the Strait of Hormuz encouraged defensive flows into the Greenback. Investors were also reluctant to make large directional moves ahead of the FOMC Minutes, which could provide fresh insight into policymakers’ views on inflation and interest rates.
• Safe-Haven Demand: Geopolitical uncertainty continues to provide underlying support for USD.
• FOMC Minutes: Traders are looking for clues about the Fed’s assessment of inflation and the future policy path.
• Middle East Risks: Continued uncertainty around Iran and Hormuz is supporting defensive positioning.
• Treasury Yields: Higher yields could strengthen the Dollar further if the Minutes lean hawkish.
• Monetary Policy: Changing expectations for another Fed rate hike remain an important driver.
• Trend: Neutral to Bullish
• Resistance: 100.00
• Support: 99.40
• Forecast: DXY could remain supported above 99.50 ahead of the Fed Minutes. A more hawkish-than-expected message could encourage another test of 100.00, while dovish signals could revive selling pressure.
• Market Sentiment: Cautiously bullish amid defensive demand.
• Catalysts: FOMC Minutes, Treasury yields, US-Iran developments and upcoming US economic data.
The New Zealand Dollar slipped to a weekly low as firm US Dollar demand outweighed support from domestic developments. NZD/USD extended its retreat from the 0.5925 area, its strongest level since early June, as investors reduced exposure to risk-sensitive currencies ahead of the FOMC Minutes.
• US Dollar: Safe-haven demand for USD remains a headwind for the Kiwi.
• FOMC Minutes: Fed policy signals could determine whether the Dollar maintains its advantage.
• Risk Sentiment: Defensive positioning generally weighs on higher-beta currencies such as NZD.
• RBNZ Outlook: New Zealand monetary-policy expectations could cushion deeper losses.
• Geopolitical Risks: US-Iran uncertainty continues to discourage aggressive risk-taking.
• Trend: Bearish
• Resistance: 0.5900
• Support: 0.5830
• Forecast: NZD/USD could remain under pressure while the Dollar retains safe-haven support. A recovery above 0.5900 would be needed to improve the near-term bullish outlook.
• Market Sentiment: Moderately bearish.
• Catalysts: FOMC Minutes, RBNZ expectations, US-Iran developments, Chinese data and broader risk sentiment.
USD/CAD consolidated around 1.3900 as investors balanced firmer US yields against uncertainty surrounding trade policy and the Federal Reserve outlook. The Canadian Dollar also remained sensitive to energy prices, while markets monitored developments surrounding the US tariff deadline.
• Trade Policy: Developments surrounding US tariffs remain particularly important for the Canadian Dollar.
• FOMC Minutes: Fed policy signals could drive the next directional move in USD/CAD.
• Oil Prices: Elevated crude prices provide underlying support for the commodity-linked CAD.
• US Yields: Firmer Treasury yields can support the US Dollar and limit CAD gains.
• Geopolitical Risks: Middle East tensions remain supportive for energy prices but also encourage USD safe-haven demand.
• Trend: Neutral
• Resistance: 1.3950
• Support: 1.3850
• Forecast: USD/CAD may remain range-bound around 1.3900 until traders receive greater clarity from the FOMC Minutes and trade developments. Stronger oil prices could favor CAD, while hawkish Fed signals could push the pair higher.
• Market Sentiment: Neutral as competing fundamental drivers keep the pair in consolidation.
• Catalysts: FOMC Minutes, US-Canada trade developments, crude oil prices, Treasury yields and Bank of Canada expectations.
The Australian Dollar reversed earlier gains as escalating Iran-related risks increased demand for the US Dollar. AUD/USD pulled back from around 0.7119 as investors became more cautious ahead of the Fed Minutes, although expectations surrounding future RBA policy could provide some support to the Aussie.
• Geopolitical Risks: US-Iran uncertainty is weighing on the risk-sensitive Australian Dollar.
• US Dollar: Safe-haven demand has strengthened the Greenback and pressured AUD/USD.
• FOMC Minutes: Fed guidance represents the key near-term catalyst.
• RBA Outlook: Australian rate expectations may help limit deeper AUD weakness.
• Risk Sentiment: A deterioration in global risk appetite generally works against the Aussie.
• Trend: Neutral to Bearish
• Resistance: 0.7120
• Support: 0.7050
• Forecast: AUD/USD could remain vulnerable below 0.7120 while geopolitical uncertainty supports the Dollar. A break below 0.7050 would increase downside risk, while improving sentiment could allow buyers to challenge recent highs again.
• Market Sentiment: Cautiously bearish as defensive positioning weighs on AUD.
• Catalysts: FOMC Minutes, RBA commentary, US-Iran developments, Chinese economic conditions and global risk appetite.
The British Pound faces an important domestic catalyst as UK CPI is expected to show inflation accelerating to a four-month high, driven partly by higher energy bills. Sterling had already come under some pressure following softer UK labor figures, making the inflation report particularly important for expectations surrounding the Bank of England’s next policy move.
• UK Inflation: Higher energy costs are expected to contribute to renewed headline inflation pressure.
• BoE Expectations: A stronger CPI reading could reinforce expectations that UK rates need to remain restrictive.
• US Dollar: Safe-haven demand for USD could limit Sterling gains even if UK inflation surprises higher.
• FOMC Minutes: Fed policy signals will also influence the Dollar side of GBP/USD.
• Geopolitical Risks: Persistent Middle East uncertainty remains a broader headwind for risk sentiment.
• Trend: Neutral
• Resistance: 1.3600
• Support: 1.3500
• Forecast: GBP/USD could see increased volatility around the UK CPI release. A stronger inflation reading may support Sterling through firmer BoE expectations, while softer data combined with a hawkish Fed message could increase downside pressure.
• Market Sentiment: Neutral ahead of major UK and US policy catalysts.
• Catalysts: UK CPI, FOMC Minutes, Bank of England expectations, US Treasury yields and geopolitical developments.
Markets remained defensive as investors balanced geopolitical uncertainty against two major monetary-policy catalysts. Safe-haven demand kept the US Dollar supported above 99.50, contributing to weakness in the New Zealand and Australian Dollars, while USD/CAD remained caught between firm US yields, trade uncertainty and support for CAD from energy markets. Meanwhile, UK inflation represents an important test for Sterling, with higher energy costs expected to push CPI higher and potentially reshape expectations for Bank of England policy.
Attention now turns firmly to the FOMC Minutes, with traders looking for evidence on how divided policymakers are over the future path of interest rates. Combined with UK inflation, tariff developments and continued US-Iran tensions, the Fed Minutes could determine whether defensive positioning persists or risk appetite begins to recover.
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Global markets turned more cautious as renewed US-Iran uncertainty, rising energy prices, and a modest US Dollar recovery weighed on precious metals and major currencies. Gold slipped back below $4,400 while Silver retreated toward $65.50, reflecting a combination of profit-taking and shifting rate expectations. In FX markets, the Euro and Australian Dollar struggled to extend recent gains, although the Canadian Dollar remained comparatively resilient as elevated crude prices provided support. With geopolitical uncertainty feeding inflation concerns, traders are reassessing the outlook for interest rates and positioning more defensively across markets.
Gold retreated from recent highs and slipped below the $4,400 area as the US Dollar recovered from a two-month low. Rising crude prices have renewed concerns about inflation, supporting expectations that the Federal Reserve may need to maintain a relatively restrictive policy stance. At the same time, uncertainty surrounding US-Iran relations continues to create competing safe-haven demand for Gold.
• Geopolitical Risks: Uncertainty surrounding US-Iran relations continues to support underlying safe-haven demand.
• Inflation Concerns: Elevated energy prices are renewing concerns that inflationary pressures could persist.
• US Dollar: The Greenback’s recovery creates a near-term headwind for Gold.
• Fed Expectations: Higher inflation risks could revive expectations for tighter monetary policy.
• Treasury Yields: Rising yields could further pressure the non-yielding precious metal.
• Trend: Neutral to Bullish
• Resistance: $4,450
• Support: $4,300
• Forecast: Gold could remain under short-term pressure while the Dollar and Treasury yields recover, but the broader bullish structure remains supported while prices hold above the $4,300 region. A renewed push through $4,450 would strengthen the case for another leg higher.
• Market Sentiment: Cautious, with profit-taking offsetting geopolitical support.
• Catalysts: US-Iran developments, oil prices, Fed expectations, Treasury yields and upcoming FOMC signals.
Silver retreated toward $65.50 as uncertainty surrounding US-Iran peace efforts encouraged more cautious positioning across precious metals. The recovery in the US Dollar also created resistance following Silver’s recent strength.
• Geopolitical Risks: Uncertainty over US-Iran diplomacy continues to influence precious-metal flows.
• US Dollar: A firmer Greenback makes Dollar-denominated metals relatively more expensive for overseas buyers.
• Inflation Expectations: Higher energy costs may support metals as inflation hedges but could simultaneously reinforce hawkish Fed expectations.
• Monetary Policy: Renewed rate-hike concerns represent a headwind for non-yielding assets.
• Profit-Taking: Silver’s recent strong performance leaves the market vulnerable to short-term consolidation.
• Trend: Neutral to Bullish
• Resistance: $67.00
• Support: $64.50
• Forecast: Silver could consolidate following its recent advance, with $64.50 providing an important downside area to watch. A recovery above $67.00 would help restore stronger bullish momentum.
• Market Sentiment: Cautious following the pullback.
• Catalysts: US-Iran negotiations, Dollar direction, Treasury yields, Fed expectations and broader precious-metal demand.
The Canadian Dollar remained near its strongest levels since early June as rising crude oil prices helped offset the modest recovery in the US Dollar. With petroleum representing a major Canadian export, higher oil prices generally provide fundamental support for CAD.
• Oil Prices: Elevated WTI prices remain the strongest source of support for the Canadian Dollar.
• US Dollar: The Greenback’s modest recovery limits the Loonie’s upside.
• Geopolitical Risks: US-Iran tensions continue supporting crude through concerns about Middle Eastern supply.
• Fed Expectations: Renewed inflation concerns could strengthen the Dollar if traders increase Fed hike bets.
• Bank of Canada: Relative BoC-Fed expectations remain important for USD/CAD direction.
• Trend: Bearish USD/CAD
• Resistance: 1.3800
• Support: 1.3700
• Forecast: USD/CAD could retain its downside bias while crude prices remain elevated, although renewed US Dollar strength may slow further CAD appreciation.
• Market Sentiment: Moderately bullish for CAD.
• Catalysts: WTI prices, US-Iran negotiations, Fed expectations, Bank of Canada commentary and North American economic data.
The Euro traded relatively flat around 1.1575–1.1580 after pulling back from a two-month high. Rising oil prices have revived inflation concerns and provided modest support to the US Dollar, making traders more cautious about extending recent EUR/USD gains.
• Inflation Risks: Higher energy prices could complicate the inflation outlook on both sides of the Atlantic.
• US Dollar: Renewed Dollar demand is limiting Euro upside.
• Fed Expectations: Oil-driven inflation concerns could revive expectations for tighter US monetary policy.
• ECB Outlook: European rate expectations remain important for the Euro’s medium-term direction.
• Geopolitical Risks: Continued US-Iran uncertainty limits broader risk appetite.
• Trend: Neutral to Bullish
• Resistance: 1.1600
• Support: 1.1500
• Forecast: EUR/USD could remain in consolidation below its recent two-month high. A sustained move above 1.1600 would favor renewed upside, while continued Dollar recovery could push the pair back toward 1.1500.
• Market Sentiment: Neutral as recent bullish momentum pauses.
• Catalysts: Fed expectations, ECB commentary, energy prices, US economic data and geopolitical developments.
The Australian Dollar remained near the 0.7100 region but buyers showed hesitation as the US Dollar recovered from its recent two-month low. The Aussie had recently benefited from broad Greenback weakness and was trading near two-month highs, leaving the pair vulnerable to consolidation as market sentiment turned more cautious.
• US Dollar: A modest Dollar rebound is limiting further AUD/USD gains.
• Risk Sentiment: More cautious global positioning represents a headwind for the risk-sensitive Aussie.
• Australian Economy: Improving domestic confidence provides some underlying support; August Westpac Consumer Confidence rose to 6% from 4.1%.
• Fed Expectations: Renewed US inflation concerns could support the Greenback if rate-hike expectations increase.
• China Outlook: Developments in China remain important due to Australia’s close trade relationship with the Chinese economy.
• Trend: Neutral to Bullish
• Resistance: 0.7130
• Support: 0.7050
• Forecast: AUD/USD could consolidate near 0.7100 as buyers hesitate following the recent rally. Holding above 0.7050 would preserve the broader bullish structure, while a break above the recent highs could reopen further upside.
• Market Sentiment: Cautiously bullish but losing momentum.
• Catalysts: US Dollar direction, Fed expectations, Australian economic data, Chinese developments and global risk sentiment.
Risk appetite softened as geopolitical uncertainty, higher energy prices, and a recovering US Dollar encouraged more cautious positioning across global markets. Gold and Silver retreated from elevated levels as investors balanced safe-haven demand against renewed inflation and interest-rate concerns. Major currencies also struggled to extend recent gains, with the Euro consolidating below its two-month high and the Australian Dollar hesitating near 0.7100. The Canadian Dollar remained the notable exception, supported by elevated crude prices as the US-Iran standoff continues to keep energy-supply concerns alive.
Looking ahead, US-Iran developments, energy prices, Treasury yields and shifting Federal Reserve expectations are likely to remain the key catalysts determining whether today’s cautious sentiment develops into a deeper pullback or risk appetite begins to recover.
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