Dollar Outlook: Can the Recovery Extend? The US dollar has gradually strengthened over recent weeks, supported by firmer macro data and resilient economic signals. Retail sales and jobless claims have surprised to the upside, while the Fed’s Beige Book continues to describe an economy expanding at a measured pace with no clear signs of labour market stress. Latest initial jobless claims fell below 200,000, pulling the four-week average to its lowest level in nearly two years.

The Japanese yen remains firmly in focus into the end of the week, continuing to exhibit elevated volatility relative to other major currencies. USD/JPY saw a sharp pullback during the Asian session, briefly dipping to the 157.97 area following renewed verbal intervention from Japan’s finance minister, Katayama. The pair has since recovered toward 158.30, though it remains capped below earlier highs around 158.60 to 158.70. While verbal intervention from Tokyo officials is no

GBP/AUD has delivered a decisive technical breakdown, finally holding below the psychological 2.000 level after weeks of compression. This move stands out from the four failed attempts since late October, as price has now closed beneath the figure for the first time since early 2025. The break releases significant downside pressure and shifts the near-term bias clearly lower. What was particularly notable is that Sterling failed to sustain gains even after an upside surprise

Japanese policymakers are increasingly caught between two competing priorities: defending domestic interest rates or defending the Yen. Sustained currency weakness risks importing inflation, while higher rates threaten an economy that has spent decades battling deflationary forces. With Japanese government bond yields pushing sharply higher and the Yen remaining under pressure, authorities are operating in largely uncharted territory with no clear historical roadmap. Since th

Near-Term Trend Shifts After December Uptrend Break GBP/USD has shifted into a more fragile short-term posture after breaking its December uptrend, following an exhaustion move just below key resistance. The failure near the upper resistance zone marked a clear change in near-term structure, with price retreating sharply from the highs before attempting to stabilize. The pullback from peak levels measured close to 1.3%, highlighting the intensity of profit-taking once resista

Gold Extends Structural Uptrend Despite Broader FX Consolidation While much of the FX space remains range-bound, with the US dollar grinding sideways and major currency pairs lacking clear directional conviction, gold continues to stand apart. The metal has been in a sustained uptrend for nearly two years, with higher highs and higher lows defining price action since early 2024. Importantly, periods of pullback have repeatedly attracted bearish sentiment, with expectations of

GBP/USD edged modestly higher during the Wednesday morning session as the US dollar eased slightly ahead of key US data releases later in the day. The broader backdrop still favours the dollar after a solid run over recent sessions, which has kept pressure on cable and other major pairs. The dollar’s rebound has been supported by a combination of mixed US data and firmer oil prices, with geopolitical tensions around Iran, Venezuela and Greenland adding to the risk backdrop. W

US inflation printed marginally below expectations, with core CPI at 2.6% versus a 2.7% forecast. Despite that, the US dollar remains firmer on the session, having erased much of its early-week weakness. The softer inflation outcome has not been enough to shift near-term dollar sentiment, particularly as broader risk appetite stabilises. Over the weekend, markets reacted to reports that the Department of Justice had opened a criminal inquiry into Jerome Powell’s summer testim

Dollar Firmness Keeps EUR/USD on the Defensive EUR/USD is attempting a modest rebound after sliding toward one-month lows, but the broader structure remains fragile. The pair continues to trade under pressure as the US dollar holds firm, supported by resilient US data and lingering uncertainty around the Federal Reserve’s policy path. While near-term selling momentum has eased, upside follow-through remains limited. US macro conditions continue to contrast with a softer Euroz

Speculation around Japanese yen intervention is resurfacing as USD/JPY edges back toward levels that previously forced action in 2024. This time, however, the underlying drivers look very different. The yen’s weakness is no longer primarily a function of widening US Japan rate differentials. Instead, it appears increasingly homegrown, shaped by domestic politics, fiscal expectations, and renewed reflation speculation. That shift complicates the intervention debate. If yen wea