Overview: The US Dollar saw a correction this week after a pullback in tariff threats and a mixed US payroll report. Major currencies like the Canadian Dollar, Japanese Yen, Australian Dollar, and South African Rand gained traction, while the Chinese Renminbi and Indian Rupee remained under pressure due to ongoing tariff risks and trade tensions. Gold prices surged to an all-time high as market uncertainty looms. Upcoming US inflation data and UK/Eurozone growth reports are expected to shape market trends in the coming week.
- US Dollar: The Dollar Index fell 0.35%, driven by a pullback in tariff threats and the US payroll report, which reduced the likelihood of a Fed rate cut.
- Asia-Pacific: The Chinese Renminbi depreciated 0.5%, trading at 7.28 against the Dollar, amidst renewed trade tensions with the US. The Japanese Yen strengthened by 2.25%, hitting its highest in nearly two months, supported by expectations of higher interest rates from the Bank of Japan. The Australian Dollar rose 1.7% on improved sentiment from trade talks between the US and China.
- South Asia: The Indian Rupee weakened 1.25%, trading at 87.5 against the Dollar, influenced by trade war fears and portfolio outflows. PKR remained stable at 278.9 against the Dollar with no significant data releases.
- Middle East and Africa: Nigerian Naira strengthened 0.11%, trading at 1480, despite mixed economic signals. The Kenyan Shilling held steady at 129.23, with the Central Bank cutting rates to 10.75% to manage inflation. South African Rand rose 1.45%, supported by the President's economic plans and a softer Dollar.
- Europe: The British Pound rose 0.9%, reaching 1.239, supported by rate cuts from the Bank of England despite weaker growth forecasts. The Euro gained 0.8%, closing at 1.031, buoyed by higher inflation and a temporary easing of tariff threats.
The FX market is navigating through turbulent times, with trade tensions and inflation data driving volatility. Stay updated on the latest trends and insights by subscribing to the full version of the report, visit: wearehubpay.com.
