The dollar index traded around 100.8 on Monday, remaining close to its strongest level since May 2025 as investors assessed evolving developments in US-Iran peace negotiations while awaiting a key US inflation reading. Reports suggested that Washington and Tehran had agreed on a roadmap toward a final deal within 60 days, easing concerns after both sides exchanged fresh threats linked to the conflict in Lebanon. Market participants are now focused on this week’s US PCE price index release, the Federal Reserveโs preferred measure of inflation. Last week, the Fed left interest rates unchanged but struck a more hawkish tone. Nine of the 19 policymakers now anticipate at least one rate increase before the end of the year, with markets increasingly pricing in a potential hike as early as September. Elsewhere, traders continued to monitor the Japanese yen amid rising intervention concerns and the British pound against the backdrop of political uncertainty in London.
Offshore Yuan Rebounds
The offshore yuan edged higher to around 6.77 per dollar on Monday, trimming losses from the previous session as broader market sentiment improved on progress in US-Iran talks while investors assessed the People’s Bank of China’s decision to leave its key lending rates unchanged. The PBoC maintained the one-year loan prime rate (LPR) at 3.0% and the five-year LPR at 3.5% for a thirteenth consecutive month, underscoring policymakersโ cautious approach as they seek to sustain growth while safeguarding financial stability. China’s economic recovery remains uneven. While resilient exports continue to provide support, domestic consumption and the property sector remain subdued. Meanwhile, the US and Iran reported constructive progress in negotiations aimed at easing regional tensions, with both sides agreeing on a roadmap toward a potential final agreement within 60 days and the establishment of a direct communication channel designed to reduce the risk of incidents and miscalculations.
Yen Slides Toward 40-Year Low
The Japanese yen weakened to around 161.5 per dollar on Monday, hovering near its lowest level since 1986 as repeated verbal interventions from Tokyo failed to halt the currencyโs decline. Finance Minister Satsuki Katayama said authorities stood ready to take appropriate action against excessive currency moves at any time, echoing earlier warnings. The yen has now surrendered all the gains made on April 30, when officials carried out a record-sized market intervention to support the currency. The latest drop came despite the Bank of Japanโs ongoing policy normalization, including a 25-basis-point interest rate increase to 1% last week. The currency also remained under pressure from heavy carry-trade activity, as investors continued to favor short yen positions amid the still-wide interest rate gap between Japan and the US.
South Korean Won Remains Under Pressure
The South Korean won weakened to around 1,538 per dollar, remaining under pressure as the US dollar stayed firm. Markets continued to price in the possibility of further Fed tightening, while investors awaited key US inflation data later this week for additional clues on the interest-rate path. Higher US yields continued to support dollar-denominated assets, reducing the appeal of emerging Asian currencies and contributing to broader strength in the greenback. The won also faced headwinds from renewed Middle East uncertainty, with oil prices rising amid ongoing US-Iran negotiations and concerns over potential disruptions to energy supplies through the Strait of Hormuz. Meanwhile, South Koreaโs exports surged 60.4% year-on-year in the first 20 days of June, driven by robust semiconductor shipments amid strong global AI-related demand. This supported expectations of continued foreign-currency inflows from overseas sales.
Rupee Holds Firm on Softer Oil
The Indian rupee hovered near 94.3 per dollar, steadying after reaching six-week highs as easing geopolitical tensions and softer crude oil prices supported sentiment. Oil prices declined after Iranian officials reported progress in negotiations with the United States, with Brent crude for August delivery falling 1.7% to $79.24 per barrel following signs of constructive talks in Switzerland. However, uncertainty persisted after US President Donald Trump warned that military action against Iran could resume, even as Vice President JD Vance met Iranian officials under an interim peace arrangement. Tehran’s renewed closure of the Strait of Hormuz added to market caution. Gains were partly capped as the dollar index held just below 101 and the benchmark 10-year US Treasury yield edged higher, though it remained below recent peaks. Investors are now focused on upcoming US inflation and growth data for clues on the Federal Reserve’s policy outlook.
Forecasting The Upcoming Week – US Dollar Loses Momentum Ahead of key U.S. Inflation Data
The week ahead will bring a fresh test for major currency pairs as investors digest the first Federal Reserve (Fed) policy decision under Chair Kevin Warsh and look ahead to the United States (US) Personal Consumption Expenditures (PCE) data, global PMI releases, and central-bank commentary.
The US Dollar Index (DXY) trades near the 100.70 price zone on Friday after reaching a 13-month high of 101.13 earlier in the day. The Greenback rose sharply this week following the Fed’s decision to leave interest rates unchanged in the 3.50%-3.75% range, and removing its previous reference to โadditional rate adjustmentsโ . A hotter-than-expected PCE report, the Fed’s favorite inflation gauge, could reinforce the Fed’s hawkish stance and extend the upward USD’s trend.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Swiss Franc.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.16% | -0.22% | -0.06% | 0.25% | -0.02% | 0.23% | 0.28% | |
| EUR | 0.16% | -0.05% | 0.13% | 0.41% | 0.14% | 0.37% | 0.44% | |
| GBP | 0.22% | 0.05% | 0.17% | 0.45% | 0.21% | 0.44% | 0.50% | |
| JPY | 0.06% | -0.13% | -0.17% | 0.30% | 0.06% | 0.27% | 0.33% | |
| CAD | -0.25% | -0.41% | -0.45% | -0.30% | -0.22% | -0.03% | 0.03% | |
| AUD | 0.02% | -0.14% | -0.21% | -0.06% | 0.22% | 0.21% | 0.30% | |
| NZD | -0.23% | -0.37% | -0.44% | -0.27% | 0.03% | -0.21% | 0.05% | |
| CHF | -0.28% | -0.44% | -0.50% | -0.33% | -0.03% | -0.30% | -0.05% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
EUR/USD declined over 0.80% this week to the 1.1480 level amid a broadly strong US Dollar. The Eurozone calendar will keep its eyes on flash PMI data, which should give investors a clearer view of whether activity remains fragile across manufacturing and services. Germany will also be important, with flash PMIs, the Ifo Business Climate survey, and GfK Consumer Confidence due during the week. Any signs of weaker German business sentiment could weigh on the Euro, especially after ECB officials warned about uncertainty around energy prices, inflation transmission, and second-round wage effects.
GBP/USD is trading near 1.3230, with a strong weekly decline, after the Bank of England (BoE) left interest rates unchanged at 3.75% in a 7-2 vote, with two policymakers supporting a hike to 4.00%. Next week, the United Kingdom (UK) flash PMIs and final Q1 Gross Domestic Product (GDP) data will be key for the Pound Sterling.
USD/JPY remains near intervention levels at 161.30, focused on the balance between Fed caution and the Bank of Japanโs (BoJ) tightening bias. The BoJ recently raised interest rates to 1.00%, while officials continue to warn that inflation risks could require further action. Japanโs flash PMIs, Tokyo CPI, and comments from BoJ officials will be watched closely.
AUD/USD fell this week toward the 0.7020 level, a significant domestic test as Australia releases flash PMIs, monthly CPI, and labor market data. A stronger CPI print or resilient employment data could support the Aussie, while weaker numbers may leave AUD/USD vulnerable to renewed US Dollar strength.
Gold (XAU/USD) struggles near the $4,155 level as geopolitical uncertainty and concerns over the Middle East could limit downside for the precious metal.
West Texas Intermediate (WTI) Oil fell for a second consecutive week near $76.50 per barrel as the US-Iran agreed a peace deal, weighing on Oil prices. Markets will watch whether Oil flows continue to normalize, as lower energy prices could ease inflation fears and influence central-bank expectations.
Anticipating economic perspectives: Voices on the horizon
Monday, June 22
- ECB President Lagarde
- Fedโs Waller
- ECB President Lagarde
Tuesday, June 23
- ECBโs Lane
- BoC Governor Macklem
- ECBโs Elderson
- ECBโs Vujฤiฤ
- BoEโs Taylor
- BoEโs Dhingra
Wednesday, June 24
- ECBโs Nagel
- BoEโs Breeden
- ECBโs Cipollone
- BoEโs Dhingra
Thursday, June 25
- ECBโs Philip
- ECBโs Cipollone
- Fedโs Williams
- Fedโs Goolsbee
Friday, June 26
- ECBโs Nagel
- Fedโs Williams
- ECBโs Vujฤiฤ
Saturday, June 27
- ECBโs Schnabel
- RBA Governor Bullock
Central banksโ meetings and policy decisions to shape markets
No major Fed, BoE, BoJ, or RBA interest rate decisions are scheduled for the week, leaving investors focused on speeches, incoming data, and the market interpretation of the latest policy meetings.
The US Dollar remembers how to rally
- DXY printed a fresh 13-month high this week after a hawkish FOMC pushed markets toward pricing a 2026 rate hike.
- The move is driven by rate differentials, not a growth scare, as the Fed out-hawks a stalling field of peers.
- Next week’s combined GDP and PCE print is the validation test for the rally.
The US Dollar Index (DXY) spent the back half of this week doing something most desks had written off six months ago: rallying on the prospect of a Federal Reserve (Fed) rate hike. The index pushed to a fresh 13-month high before easing back; the move owed less to safe-haven flight than to a cold read on rate differentials. With the Federal Open Market Committee (FOMC) leaning hawkish at its June meeting, the Greenback has become the cleanest way to play the only major central bank still willing to tighten into an energy shock.
A yield gap, not a panic
Underneath the geopolitical noise, the Dollar’s bid is a yield story. The Fed has parked itself in a higher-for-longer posture while the field around it has stalled or blinked. The Bank of England (BoE) and the Swiss National Bank (SNB) both held this week, with the Greenback taking its largest gains against the Pound and the Franc. Even the European Central Bank (ECB), which delivered its first hike since 2023, is tightening defensively into a contracting economy rather than a strong one; that distinction is the entire trade.
Warsh pulls the guidance rug
New Fed Chair Kevin Warsh used his first meeting to do less, not more. The Committee held at 3.75% as expected; the updated dot plot told the real story, with the rate projections revised higher across the board and the median now embedding a hike bias for the year. Warsh himself declined to signal the next move, leaning instead on the line that inflation has sat above target for years and that restoring price stability comes first. Markets took the hint and ran: pricing on CME FedWatch now leans toward a hike by the autumn, with inflation forecasts revised higher on the back of the Middle East conflict. A central bank that refuses to promise cuts, in a world where everyone else is cornered, is a powerful tailwind for its currency.
The number that settles it
Every bar of this rally is implicitly long the hawkish-Fed thesis, which means next week hands the Dollar its first real audit. Thursday delivers a rare double-header at 12:30 GMT: the third estimate of first-quarter Gross Domestic Product (GDP) lands alongside the May Personal Consumption Expenditures Price Index (PCE), the Fed’s preferred inflation gauge. The growth print is seen confirming 1.6%, down from the initial 2.0%; the spotlight therefore falls on PCE. Core PCE is already pencilled in to accelerate to 0.3% MoM from 0.2%, which means even an in-line print stamps reacceleration onto core inflation; an upside surprise, coming after May headline Consumer Price Index (CPI) leapt above 4% YoY, would cement the hike pricing and send the index back to test its highs. A soft one would expose how much good news is already in the price.
Resistance: The 101.00 round figure caps the immediate upside, with this week’s 13-month peak just above it; a clean break opens room toward 102.00.
Support: Initial support sits near 100.50, then the psychological 100.00 handle; below that, the 50-day and 200-day Exponential Moving Average (EMA) cluster near 99.00 marks where the trend would come into question. The hourly Stochastic Relative Strength Index (Stoch RSI) is washed out near oversold, which argues the current dip is a pause rather than a turn.
Bias: Bullish while the index holds above 100.00 and the hawkish-Fed narrative survives next week’s data. A hot PCE keeps the path toward 102.00 open; a downside inflation surprise is the one catalyst that turns this stretched-but-intact rally into a deeper pullback toward 99.00.
US Dollar Index hourly chart
The Australian Dollar looks for an excuse to break ranks
- AUD/USD was knocked lower this week as a hawkish FOMC powered the US Dollar broadly higher.
- The RBA held this month, with above-target inflation keeping a further hike on the table.
- Wednesday’s Australian CPI is the Aussie’s best chance to trade on something other than the Dollar.
The Australian Dollar spent this week as a passenger in someone else’s trade. A hawkish Federal Open Market Committee (FOMC) and a surging US Dollar dragged the Aussie down to the 0.7000 handle, with the pair’s sharp mid-week drop owing more to events in Washington than to anything out of Canberra. Yet the Aussie is not quite the pure risk-proxy it tends to get treated as. It carries a domestic inflation problem of its own; next week hands it a rare chance to trade on that rather than on the Greenback’s momentum.
The RBA is not done being hawkish
The Reserve Bank of Australia (RBA) left its cash rate unchanged at 4.35% this month, yet struck a far-from-dovish tone. Policymakers flagged that inflation remains elevated and has picked up materially, driven in part by higher fuel and commodity prices tied to the Middle East conflict, with pass-through into goods and services already visible. Several desks still see scope for additional tightening before any easing cycle begins; the central bank’s own projections keep inflation above target into 2027. That is a meaningfully firmer footing than most of the Aussie’s peers can claim.
Why the carry can’t catch a bid
None of that has been enough to lift the currency, because the Aussie answers to more than its own rate story. It trades as a liquid proxy for both risk appetite and China, neither of which has helped: a stronger Dollar saps risk sentiment, while soft Chinese demand and a heavy Iron Ore market cap any rebound in Australia’s terms of trade. The result is a currency with real domestic inflation pressure that still cannot pull away from the 0.7000 handle. As long as the Dollar owns the tape, the Aussie’s better fundamentals stay academic.
Two home prints, then the Dollar
Next week finally gives the Aussie a domestic slate to trade. Australia’s monthly Consumer Price Index (CPI) for May lands on Wednesday at 01:30 GMT, with the annual rate seen ticking up to 4.3% and the trimmed mean, the RBA’s preferred core measure, in focus; a hot reading would revive hike bets and hand the currency a genuinely idiosyncratic reason to firm, even against a strong Dollar.
The May employment report follows on Thursday in the same early slot, after the prior month’s surprise contraction in jobs; a rebound would reinforce the hawkish case. The complication is timing: that jobs print lands the same day the US delivers its first-quarter Gross Domestic Product (GDP) third estimate and the May Personal Consumption Expenditures Price Index (PCE) at 12:30 GMT. A firm Australian double-header into a hot US PCE would leave the Aussie pulled in both directions; the Dollar leg usually wins that tug-of-war.
Resistance: The 0.7050 level is the first hurdle, with the 50-day Exponential Moving Average (EMA) near 0.7100 capping the broader pullback; the Aussie needs a close back above 0.7100 to argue the down-leg is over.
Support: The 0.7000 handle is the line that matters; it has so far held. A sustained break exposes 0.6950, then the 200-day EMA near 0.6900.
Bias: Neutral-to-bearish while price sits below 0.7100 and the Dollar dominates, but with a clear two-way risk next week. The daily Stochastic Relative Strength Index (Stoch RSI) near oversold leaves room for a bounce; a hot Australian CPI is the catalyst most likely to deliver one. A soft CPI into a firm US PCE points the pair back through 0.7000 toward 0.6950.
AUD/USD hourly chart
