USD
Continuing its downtrend after a July rebound.
Softer data and dovish Fed signals raise odds of September rate cuts.
Markets now price slightly more than 25bps cut for September.
Powell at Jackson Hole could outline restart of easing cycle.
View: Further USD weakness; EURUSD targeting 1.21 by year-end.
EUR
Focus on June trade data and Thursday’s flash PMIs.
Recovery in manufacturing expected to support sentiment.
Geopolitics (Ukraine/Russia) could add volatility.
Main driver remains USD direction.
View: EURUSD to recover, stable vs GBP and CHF; EURCHF bias 0.94–0.95 range.
GBP
Focus shifts to UK CPI next Wednesday.
Hawkish BoE stance and stronger GDP supportive but mostly priced in.
Resistance at 1.38 unlikely to break sustainably until later this year.
BoE stuck between weak growth, soft labor market, and high inflation.
View: GBP supported by attractive carry, but risks from fiscal issues make outlook cautious.
AUD
RBA cut 25bps to 3.6% in August, guidance largely unchanged.
Labor market strong: unemployment at 4.24%, big full-time jobs gain.
Inflation pressures and wage growth remain elevated.
View: Cautious easing path with two more cuts (Nov, Feb) to 3.1%. AUDUSD seen at 0.68–0.70 mid-2026; favor longs at 0.64 or below.
JPY
USDJPY drifting lower to 146–147 as Fed cuts priced in.
Local reports suggest BoJ facing pressure for hawkish shift.
CPI expected around 3.3%, above 2% target.
View: BoJ could hike in December (not fully priced); prefer selling USDJPY upside for yield pickup.
