USD holds steady as markets digest soft Aussie inflation and await Powell’s testimony. Pound to Rand forecast and Indian Rupee outlook in focus.
FX Snapshot – 07:14 GMT
| Pair | Level | Daily % | Weekly | YTD |
|---|---|---|---|---|
| EUR/USD | 1.1616 | +0.03% | +1.20% | +12.16% |
| GBP/USD | 1.3624 | +0.07% | +1.53% | +8.83% |
| AUD/USD | 0.6497 | +0.03% | –0.18% | +4.97% |
| USD/JPY | 145.10 | +0.11% | –0.03% | –7.78% |
| USD/ZAR | 17.7571 | +0.07% | –1.23% | –5.81% |
| USD/INR | 85.88 | –0.11% | –0.73% | +0.35% |
Macro View: What’s Driving FX Markets
Australia CPI Eases
- May inflation slowed to 2.1% YoY (vs 2.3% forecast), the lowest in over a year.
- This supports growing expectations for a rate cut at July’s RBA meeting.
- AUD/USD is hovering near 0.6500, holding steady despite weaker inflation.
Powell’s Congressional Testimony (Day 2)
- Fed Chair Jerome Powell reiterated rate cuts are not imminent.
- Emphasis remains on inflation data and the impact of trade tariffs.
- Markets now expect two cuts by year-end, with reduced July odds.
- The USD remains broadly firm, but slightly off last week’s highs.
Currency Forecasts
Pound to Rand Forecast (GBP/ZAR)
- Trading near R17.76 amid dollar strength and stable risk sentiment.
- Short-term outlook: R17.90 to R18.10, assuming no major shocks.
- This pound to rand forecast remains modestly bullish.
Sterling to Rupee Forecast (GBP/INR)
- GBP/INR trades around 117.00, benefiting from firm GBP/USD levels.
- Powell’s neutral tone has capped volatility.
- GBP to INR forecast tomorrow: rangebound between 116.80–117.20.
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GBP to AED Forecast
- GBP/AED remains above 5.00, reflecting wider strength in sterling.
- Medium-term: steady around 5.03–5.08 unless oil or Fed tone shift materially.
Pound to Lira Forecast (GBP/TRY)
- GBP/TRY slightly lower but still elevated.
- Turkey’s inflation outlook keeps lira under pressure.
- Forecast range: 42.50–43.80 near-term.
What to Watch
- 14:00 GMT: Powell testifies again – watch for signals on inflation path or dollar strength.
- Middle East: Ceasefire holds, but geopolitical risks remain relevant for ZAR, MXN, and oil-sensitive currencies.
- RBA Rate Decision (Next Week): Stronger odds of a cut after today’s soft CPI data.
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