The Brazilian real strengthened past 5.55 per USD in June, its strongest level in nearly eight months, amid latest inflation data, high real interest rates, clearer fiscal signals, and a milder external backdrop. May’s headline inflation eased to 5.32%, surprising to the downside while still exceeding the target for a seventh consecutive month, reinforcing the Central Bank’s latest rate hike. Copom’s move to raise the Selic to 14.75%, a 17-year high, while signaling a likely pause, preserved Brazil’s substantial carry advantage, sustaining strong portfolio inflows. On the fiscal front, the administration’s agreement to “recalibrate” the IOF adjustment has dispelled much uncertainty, narrowing sovereign spreads and somewhat restoring confidence in Brazil’s fiscal trajectory. Externally, reports that US–China export-controls talks in London are progressing smoothly have eased global risk aversion and lent support to commodity-linked currencies, further underpinning the real’s advance.

Brazilian Real Appreciates to 8-Month High

The dollar index trimmed most of its earlier gains to trade flat around the 99 level on Tuesday, as traders awaited the outcome of ongoing trade negotiations between the US and China, now in their second day. While no major breakthroughs were reported after the first round of discussions, US officials expressed optimism about the negotiations. US Commerce Secretary Howard Lutnick said talks are going well and are expected to go all day Tuesday. Investors are also awaiting key economic data, with CPI and PPI reports due later this week expected to shed light on inflationary pressures and the broader impact of the ongoing trade war. The dollar remains near its April lows—the weakest levels since 2022—amid growing concerns over the economic effects of President Trump's trade and fiscal policies, which have led to a shift away from US assets. On the day, the greenback was mostly stronger against the British pound after weaker UK jobs data raised bets for the BoE's rate cuts.

Dollar Pares Most Gains, US-China Talks Awaited

The euro hovered around the $1.14 mark, near the three-year highs reached in April, as traders closely monitored developments in the ongoing US-China trade talks. At the same time, investors assessed comments from European Central Bank officials for clues about the ECB's next policy moves. Governing Council member François Villeroy de Galhau noted that the ECB could still act swiftly to adjust interest rates, even after its eighth consecutive cut, which he said had "normalized" monetary policy. Last week, the ECB lowered rates as expected, but President Christine Lagarde indicated the easing cycle may be approaching its end. The deposit facility rate now stands at 2%, while Eurozone inflation eased to 1.9% in May 2025. Meanwhile, the bloc’s economy expanded by 0.6% in Q1 2025, the fastest growth rate since Q3 2022.

Euro Hovers at $1.14

The British pound weakened to $1.35 after fresh economic data signaled a notable slowdown in the labour market, strengthening the case for a Bank of England rate cut. Wage growth came in below expectations, with private sector pay, a key metric closely monitored by the central bank, also decelerating. Meanwhile, the unemployment rate rose to its highest level since 2021, and the number of payrolled employees posted the steepest drop since 2020, suggesting early signs of the impact from higher National Insurance Contributions (NICs) and the recent increase in the National Living Wage. While the Bank of England is mostly expected to leave interest rates unchanged at its policy meeting next week, market odds for a rate cut in August have increased. Traders are also closely watching upcoming monthly GDP data and the government’s spending review, both due later this week, for further insight into the UK’s economic trajectory.

British Pound Depreciates After Labour Data

The South Korean won depreciated toward 1,360 per dollar on Tuesday, pulling back from near eight-month highs as the dollar strengthened amid signs of easing US-China trade tensions. Improved US-China relations boosted demand for the greenback, weakening emerging market currencies like the won, as recent high-level talks on tariff cuts and strategic cooperation aim to restore trade flows and resolve disputes over technology, IP, and market access. Additionally, President Lee Jae-myung and President Donald Trump have agreed to hold direct talks soon, with both leaders expressing a commitment to reaching a swift and mutually beneficial agreement on trade tariffs. Working-level negotiations are expected to begin ahead of the planned summit.

Korean Won Pulls Back on Dollar Strength

The Australian dollar held its gains around $0.651 on Tuesday, remaining buoyed by optimism over progress in high-level trade talks between the US and China. Treasury Secretary Scott Bessent led the US delegation in talks with Chinese Vice Premier He Lifeng and his team in London, focusing on rare earth exports and the potential easing of trade restrictions. The discussions, set to continue through Tuesday, were announced last week following a long-anticipated call between US President Donald Trump and Chinese President Xi Jinping, as well as last month’s trade deal in Switzerland. In Australia, consumer sentiment rose for the fourth time this year, with the Westpac-Melbourne Institute Consumer Sentiment Index increasing by 0.5% month-over-month to 92.6 in June. Meanwhile, business confidence improved, with the NAB Business Confidence Index rising to 2 in May from -1 in the previous month—turning positive for the first time since January and reaching its highest level in four months.

Australian Dollar Holds Gains

The Japanese yen weakened to around 145 per dollar on Tuesday, reaching a near two-week low as optimism surrounding US-China trade talks dampened demand for safe-haven assets. Officials from both nations met in London on Monday to discuss rare earth shipments and the potential easing of export restrictions, with further negotiations expected to continue on Tuesday. On the domestic front, revised data showed Japan’s economy was flat in the first quarter, improving from an initial estimate of a 0.2% contraction. Still, the result marks a notable slowdown from the 0.6% expansion recorded in the previous quarter. Meanwhile, Bank of Japan Governor Kazuo Ueda last week reiterated the central bank’s readiness to raise interest rates if economic and inflation projections are met, reinforcing expectations of a gradual shift away from ultra-loose monetary policy.

Japanese Yen Weakens as Haven Demand Eases

The offshore yuan remained steady to around 7.18 per dollar on Tuesday, as investors awaited further progress over the US-China trade negotiations. Senior officials from both countries wrapped up their first day of talks in London, which both sides described as “productive.” The discussions, focused on easing tensions over shipments of technology and rare earth elements, are set to continue on Tuesday morning. The talks come at a critical juncture, with China facing mounting economic pressures, including persistent deflation and worsening trade conditions. Data released this week showed consumer prices fell for a fourth straight month, while producer deflation hit its worst level in two years. This aligned with recent trade figures showing imports declined amid weak demand, while export growth slowed to a three-month low in May due to the impact of US tariffs. The yuan is expected to remain largely unchanged as markets stay cautious ahead of any concrete outcomes from the negotiations.

Offshore Yuan Holds Ground as Trade Talks Advance

The New Zealand dollar fell to around $0.603 on Tuesday, giving back gains from the previous session as the US dollar regained strength on optimism over US-China trade talks. Investors remain hopeful despite no major breakthroughs on the first day. President Trump said the talks “should go very well,” while US officials proposed easing tech export restrictions in exchange for China loosening rare earth shipment limits, crucial for energy, defense, and technology industries. Still, the antipodean currency remained close to an eight-month high reached last week amid growing bets that the Reserve Bank of New Zealand will slow the pace of rate cuts despite downgraded economic forecasts. The May policy decision signaled that the easing cycle could be nearing its end, with markets now expecting the RBNZ to hold rates steady in July and possibly deliver a final cut in August.

New Zealand Dollar Declines

The US dollar index rose above 99.2 on Tuesday, reversing losses from the previous session as investors focused on ongoing US-China trade negotiations in London. Treasury Secretary Scott Bessent and other senior officials met with their Chinese counterparts on Monday to discuss rare earth shipments and a possible easing of export restrictions, with further talks expected Tuesday. Hopes for a tariff truce between the world’s two largest economies buoyed the dollar, which has faced pressure this year amid President Donald Trump’s trade policies that dampened investor confidence in US assets. Markets are also closely watching upcoming CPI and PPI reports later this week, which are expected to provide further insights into inflation dynamics and the economic fallout from the prolonged trade dispute. The greenback advanced broadly, with the largest gains seen against the Japanese yen, euro, and British pound.

Dollar Strengthens as US-China Trade Talks Fuel Optimism

The Mexican peso rallied past 19.10 per USD, its strongest level in more than nine months, driven by hawkish expectations for the Bank of Mexico and a softer US dollar. In May, headline inflation climbed to 4.42%, its highest in six months, while core inflation accelerated to 4.06%, an eleven-year peak that constrains any near-term rate cuts. At the same time, Mexico’s merchandise exports beat forecasts by rising 1.2% in April despite US steel and aluminum tariffs, highlighting resilient external demand. Record remittance inflows of USD 5.8 billion in April further bolstered foreign-exchange reserves and underpinned the currency. Finally, diplomatic efforts, anchored by Economy Minister Marcelo Ebrard’s mission to secure tariff exemptions in Washington, have eased trade-war anxiety, allowing investors to embrace Mexico’s attractive yield differential as the US dollar languishes near multi-year lows amid concerns over President Trump’s trade and fiscal policies.

Mexican Peso at Over 9-Month High

The US dollar index pared earlier losses to trade largely flat around the 99.1 level on Monday, as traders closely monitored US-China talks taking place in London. The meeting follows a phone call last week between President Trump and President Xi, reviving hopes that trade tensions might begin to ease. Investors are also awaiting key economic data, with CPI and PPI reports due later this week expected to shed light on inflationary pressures and the broader impact of the ongoing trade war. Despite Monday's stabilization, the dollar remains near its April lows—the weakest levels since 2022—amid growing concerns over the economic effects of President Trump's trade and fiscal policies, which have led to a shift away from US assets. On the day, the greenback was mostly weaker against the yen and the Australian dollar.

Dollar Pares Losses

The euro rebounded above the $1.14 level, edging closer to the six-week high of $1.149 reached on June 5, as investors tracked progress in US-China trade talks and looked ahead to key speeches from European Central Bank officials for insight into the ECB’s policy outlook. Top US and Chinese negotiators are set to meet in London today, aiming to build on last month’s preliminary agreement in Geneva, with discussions likely to focus on rare-earth minerals and advanced technology. On the monetary front, the ECB cut interest rates by 25 basis points last week—bringing borrowing costs to their lowest since November 2022—and cut its inflation projections for 2025 and 2026. However, the bank also signaled it may be nearing the end of its current easing cycle, contrary to earlier expectations.

Euro Rises Above $1.14 Amid Trade Talks, ECB Signals Shift

The South Korean won strengthened toward 1,350 per dollar on Monday, nearing an almost eight-month high as investor sentiment improved after US President Trump and South Korean President Lee Jae-myung agreed to initiate talks on a revised tariff framework aimed at ensuring fair and balanced trade. The agreement is expected to ease tensions from previous disputes and stabilize key export sectors such as steel, automobiles, and semiconductors. Additionally, President Trump has invited President Lee to a summit in the US, with a potential meeting planned for the G7 in mid-June. Progress had been delayed by South Korea’s recent political transition after an earlier proposal to eliminate tariffs under a “July package” before the end of Trump’s 90-day tariff freeze.

Korean Won Strengthens on Trade Deal Hopes

The Japanese yen appreciated past 144.5 per US dollar on Monday, rebounding after two consecutive days of losses, as revised data showed the country’s first-quarter GDP was flat—an improvement from the previously estimated 0.2% contraction. Despite the upward revision, the result still reflects a sharp deceleration from the 0.6% growth recorded in the prior quarter. Separately, Japan’s current account surplus narrowed in April and fell short of market expectations, adding a mixed note to the economic outlook. Last week, Bank of Japan Governor Kazuo Ueda reaffirmed the central bank’s readiness to raise interest rates if economic and inflation forecasts are met, reinforcing the view of a gradual but steady tightening path. Externally, market participants also turned their attention to upcoming US-China trade talks, with officials from both sides scheduled to meet in London later today.

Yen Strengthens Following Upward GDP Revision

The Australian dollar rose to around $0.651 on Monday, extending gains from the previous week amid renewed optimism over US-China trade talks. US President Donald Trump announced that officials from both countries would convene in London later today, with Treasury Secretary Scott Bessent leading the US delegation and China’s Vice Premier He Lifeng expected to head the Chinese side. The talks come at a critical time for both economies, as China battles deflationary pressures, while persistent trade uncertainty continues to dampen business and consumer confidence in the US. In Australia, a leading economist has called on the central bank to deliver a bold 35 bps interest rate cut at its July meeting—surpassing the standard 25 bps reductions made in February and May. The recommendation comes amid sluggish economic growth and subdued consumer spending, both of which are holding back a more robust recovery in the private sector.

Aussie Dollar Gains on Trade Talk Optimism

The New Zealand dollar rose to around $0.604 on Monday, climbing back toward the eight-month high reached last week, supported by optimism over easing global trade tensions. President Donald Trump said Treasury Secretary Scott Bessent and two other officials will meet with Chinese counterparts in London on Monday for renewed trade talks. Meanwhile, fresh Chinese data revealed persistent deflationary pressures, with consumer prices falling for a fourth consecutive month and producer prices recording their steepest decline in nearly two years. This placed some downward pressure on the antipodean currency, given China’s role as a key trading partner. On the domestic front, the Reserve Bank recently cut rates by 25 basis points to 3.25%. However, the May decision suggests the easing cycle may be nearing its end. Markets now expect the RBNZ to hold rates steady in July, while pricing in the likelihood of a final cut in August.

NZ Dollar Approaches 8-Month Highs

The offshore yuan strengthened to around 7.18 per dollar, ending a two-consecutive session of losses, supported by potential easing of US-China trade tensions despite deepening deflationary concerns. Market sentiment improved as trade tensions appeared to ease between the US and China, following reports that Beijing granted temporary approvals for rare earth exports, while Boeing resumed commercial jet deliveries to China. Additionally, Chinese Vice Premier He Lifeng is set to meet US Treasury Secretary Scott Bessent and his trade team in London this week for renewed talks. Meanwhile, the yuan came under pressure as consumer prices fell for a fourth straight month and producer prices saw their steepest drop in nearly two years, underscoring persistent deflationary pressures and Beijing’s limited success in reviving domestic demand. The data raised concerns over China’s economic recovery and strengthened the case for further monetary easing amid tariff uncertainties.

Offshore Yuan Snaps 2-Day Losing Streak

The US dollar index edged lower to around 99 on Monday, trimming gains from the previous session as investors braced for a busy week of key economic data and trade developments. Sentiment was influenced by renewed hopes for progress in US-China trade relations as President Donald Trump announced that officials from both countries would meet in London later today, following a recent phone call with Chinese President Xi Jinping. On the data front, markets are awaiting several major economic releases. The Consumer Price Index is due Wednesday, followed by the Producer Price Index and the University of Michigan’s consumer sentiment report on Friday. These figures could offer fresh insight into how tariffs are influencing inflation and broader economic conditions. The dollar had strengthened on Friday after the May jobs report showed slightly stronger-than-expected employment growth, although private employment, jobless claims and services data pointed to some weakness in the economy.

Dollar Slips as Markets Eye Trade Talks, Key Data

The South African rand dipped slightly to around 17.8 per USD, pressured by a stronger dollar and falling prices of precious metals, particularly gold. The currency had earlier climbed to a five-month peak of 17.75 per USD on June 4 after lawmakers endorsed the National Treasury’s fiscal plan, clearing the way for approval in a June 11 vote in the lower house of parliament. This followed two prior rejections by coalition members amid disputes over a proposed VAT hike. Finance Minister Enoch Godongwana’s third budget version, presented in May, dropped the VAT increase while introducing spending cuts and higher fuel levies. Meanwhile, South Africa’s economy narrowly avoided a contraction in Q1 2025, growing by just 0.1%, down from 0.4% in Q4 2024 but surpassing market forecasts of stagnation.

South African Rand Weakens Slightly

The euro slipped further below the $1.14 mark on Friday, retreating from Thursday’s six-week high of $1.149, as a stronger-than-expected US jobs report boosted the dollar. The US added 137,000 jobs in May, slightly above the forecast of 130,000, while the unemployment rate held steady at 4.2% and wage growth accelerated to 0.4%, surpassing expectations of 0.3%. In Europe, investors continued to digest the ECB’s widely expected 25-basis-point rate cut and President Christine Lagarde’s signal that the easing cycle may be nearing its end. The central bank also lowered its inflation forecasts for 2025 and 2026, citing softer energy prices and a stronger euro. Also, ECB policymaker Yannis Stournaras told Bloomberg that the eurozone has achieved a soft landing and that most rate cuts are likely behind us, though uncertainty persists—particularly around the potential impact of new tariffs.

Euro Slips as Strong US Jobs Data Lifts Dollar

The Canadian dollar traded around 1.37 per USD in early June, near its eight-month peak of 1.367 reached on June 5th, reflecting weakening domestic fundamentals alongside a firmer US currency. In May, Canada’s job market added just 8,800 positions and saw the unemployment rate rise to 7%, its highest since late 2021, underscoring how manufacturers are starting to feel the pinch from US tariffs on aluminum, steel, and autos. These labor-market strains stand in stark contrast to earlier signs of resilience, such as 2.2% Q1 GDP growth and consecutive retail-sales gains, that prompted the Bank of Canada to hold its policy rate at 2.75% with little indication of imminent cuts. Meanwhile, Ottawa’s “intensive and live” negotiations with Washington have yet to dispel fears of a broader trade shock, leaving export-dependent industries vulnerable. At the same time, the US dollar strengthened after May’s nonfarm payrolls slightly outperformed expectations, further capping the loonie.

Canadian Dollar Eases After Labor Market Data

The US dollar index rose over 0.4% to above 99.1 on Friday after the latest US jobs data showed 139,000 jobs added in May, slightly better than the 126,000 economists had expected. However, a downward revision to April’s numbers tempered some of this optimism. The report comes amid recent signs of a slowing US economy, raising concerns about the impact of ongoing tariff negotiations and what the Federal Reserve’s next moves might be. Despite Friday’s rise, the dollar is still set for a small weekly loss as investors remain cautious about stalled US-China trade talks ahead of an early July deadline. A highly anticipated call between President Trump and China’s Xi Jinping offered little clarity, and attention quickly shifted to a public dispute between Trump and Elon Musk, which now shows signs of easing.

DXY Strengthens after Payrolls Numbers

The Russian ruble hovered around 79.4 per USD, near two-year highs, and has gained roughly 30% so far this year, supported by capital controls, tight monetary policies, and general dollar weakness. A key driver has been the conversion of foreign earnings by Russian exporters, particularly in the oil sector, who are required by the government to repatriate a portion of their foreign currency revenues and exchange them for rubles on the domestic market. Additional capital control measures, introduced after the invasion of Ukraine, have also bolstered the ruble. These include restrictions on foreign companies. Meanwhile, discussions surrounding potential peace negotiations with Ukraine have offered some support to the ruble, despite no major agreements being reached. In monetary policy, the Central Bank of Russia cut its benchmark interest rate by 100bps to 20% during its June 2025 meeting, the first reduction in nearly three years, citing easing inflation and signs of economic weakness.

Russian Ruble Holds Around 2-Year Highs

The euro slipped slightly to $1.142 but remained near Thursday’s six-week high of $1.149, following the ECB’s widely anticipated rate cut and President Christine Lagarde’s indication that the bank is approaching the end of its easing cycle. Meanwhile, ECB policymaker Yannis Stournaras told Bloomberg that the eurozone has achieved a soft landing and that most rate cuts are likely behind us—though uncertainty remains, particularly due to the potential impact of new tariffs. On Thursday, the ECB lowered interest rates by another 25 basis points and revised down its inflation forecasts for this year and next, now projecting headline inflation to average 2.0% in 2025 and 1.6% in 2026—a 0.3 percentage point cut since March—reflecting lower energy prices and a stronger euro. The euro also gained some support from broad dollar weakness, as investor confidence in US assets wanes amid President Trump’s tariffs and spending cuts, raising concerns about the outlook for US economic growth.

Euro Dips but Holds Strength Amid ECB Signals of Rate Cut End

The Indian rupee firmed slightly to around 85.7 per US dollar, after the Reserve Bank of India (RBI) delivered a larger-than-expected 50 basis point cut to the repo rate and lowered the reserve ratio for banks in a bid to support economic growth. The RBI kept its growth forecast steady at 6.5%, highlighting the economy’s resilience in a turbulent global environment, and revised its inflation forecast down to 3.7% from 4.0%, remaining well within its target range of 2–6%. The central bank, however, changed its monetary policy stance from "accommodative" to "neutral", stating that it may have limited space for further easing.

Indian Rupee Edges Higher

The offshore yuan weakened toward 7.18 per dollar on Friday, extending losses from the previous session, as optimism over renewed US-China trade talks failed to lift sentiment. President Trump and China’s Xi Jinping spoke on Thursday and agreed that officials from both sides would soon resume negotiations aimed at ending the trade war, though no concrete details were provided. Analysts noted that despite the renewed dialogue, tensions remain elevated and risks of further escalation persist amid limited substantive progress. Adding pressure, recent data showed that China’s composite PMI dropped to a 2-1/2-year low in May, marking the first contraction in private sector activity since December 2022. Investors now await a batch of key economic data—including consumer and producer prices and trade figures—amid persistently weak domestic demand and continued uncertainty over US tariffs.

Offshore Yuan Extends Losses

The New Zealand dollar fell to around $0.603 on Friday, giving back gains from the previous session as the US dollar stabilized ahead of the nonfarm payrolls report. Investors also continued to digest a phone call between US President Donald Trump and Chinese President Xi Jinping, during which both leaders agreed to resume trade talks, though no concrete details were shared. On the domestic front, the Reserve Bank of New Zealand cut rates by 25 basis points to 3.25% last week, but the May decision suggests the easing cycle may be nearing its end. Markets now expect the RBNZ to hold rates steady in July, while pricing in about a 70% chance of a rate cut in August—potentially the final one in the loosening cycle. For the week, the antipodean currency is on track for a gain of over 1%.

New Zealand Dollar Weakens

The Japanese yen slipped toward 144 per dollar on Friday, extending losses from the previous session as traders adopted a cautious stance ahead of the closely watched US monthly jobs report. Sentiment was also influenced by a phone call between US President Donald Trump and Chinese President Xi Jinping, in which the two leaders agreed to continue trade negotiations, though no concrete details were provided. On the domestic front, data showed that Japan’s household spending unexpectedly declined in April, as rising prices continued to weigh on consumer demand. The soft reading adds to the list of factors the Bank of Japan is monitoring as it assesses the timing of its next interest rate hike. Still, BOJ Governor Kazuo Ueda reaffirmed earlier this week that the central bank stands ready to raise rates if economic and inflation forecasts are met, reinforcing expectations of a cautious but steady policy tightening path.

Japanese Yen Weakens Ahead of Key US Jobs Report

The Australian dollar weakened toward $0.650 on Friday, as dovish RBA outweighed cautious optimism over US-China trade negotiations.The Reserve Bank of Australia’s May meeting minutes showed policymakers saw a stronger case for a 25 basis point cut, emphasizing a cautious, predictable stance. RBA Assistant Governor Sarah Hunter warned that higher US tariffs and rising uncertainty could dampen global growth and weigh on Australia’s economy. Meanwhile, President Trump and China’s Xi Jinping held a phone call on Thursday, where both sides agreed to resume trade talks aimed at ending the ongoing trade war. While this is positive for the global economy, analysts noted that tensions remain high amid a lack of substantive progress. They also flagged the August 12 expiry of the 90-day pause in the US-China trade war as a key downside risk for the Australian dollar. However, the Aussie found support as rising odds for additional Fed rate cuts kept the US dollar under pressure.

Australian Dollar Weakens

The US dollar index stabilized around 98.8 on Friday as investors awaited the release of the closely watched May jobs report, expected to provide fresh insights into the health of the economy amid persistent trade-related uncertainty. The greenback came under pressure earlier in the week after a string of weak US economic data raised concerns that President Donald Trump’s tariffs may be starting to weigh on growth. Recent figures showed a rise in weekly jobless claims, softer private employment numbers, and an unexpected contraction in services activity. While Trump has continued to call on the Federal Reserve to cut interest rates, Fed officials have remained cautious, citing elevated uncertainty surrounding trade policy. The dollar is on track for broad-based weekly losses, with the sharpest declines seen against the South Korean won, New Zealand dollar, and Australian dollar.

Dollar Steadies Ahead of May Jobs Report

The Brazilian real strengthened to 5.6 per USD in early June, its strongest level in nearly eight months, driven by broad-based greenback weakness and optimism that US tariffs may prove less severe. A phone call between Presidents Xi Jinping and Donald Trump rekindled hopes of a truce in the US–China trade war, triggering a widespread dollar selloff and amplifying concerns that tariffs are dampening American growth, as evidenced by a softening labour market. Domestically, lingering fiscal uncertainty over alternatives to the IOF decree has been tempered by the Central Bank’s readiness to defend the currency and its indication that the Selic rate will remain steady as inflation cools, drawing carry-trade inflows into reais.

Brazilian Real at Near 8-Month High

USDRSD decreased to a 3-1/2-year low of 102.01. Over the past 4 weeks, US Dollar Serbian Dinar lost 1%, and in the last 12 months, it decreased 5.04%.

Serbian Dinar Hits 3-1/2-year High

USDNOK decreased to a 22-month low of 10.05. Over the past 4 weeks, US Dollar Norwegian Krone lost 2.25%, and in the last 12 months, it decreased 4.71%.

Norwegian Krone Hits 22-month High

The US dollar index extended its decline to 98.6 on Thursday, its lowest level since April 21, as a fresh batch of economic data deepened concerns about the US economic outlook. Weekly jobless claims rose to 247,000 in the final week of May—the highest since early October 2024 and above expectations of 235,000—signaling potential softening in the labor market. Meanwhile, separate reports showed that productivity fell more sharply than initially estimated in Q1, driven by a steeper rise in labor costs. Additionally, April trade data revealed a narrowing in the trade deficit, largely due to a drop in imports. Investors are now turning their attention to Friday’s nonfarm payrolls report for further clues on the Federal Reserve’s next move. While President Trump continues to urge rate cuts, Fed officials have maintained a cautious stance amid ongoing trade uncertainties.

Dollar Falls to Six-Week Low as Soft Data Fuels Fed Rate Cut Bets

GBPUSD increased to a 3-year high of 1.36. Over the past 4 weeks, British Pound US Dollar gained 1.65%, and in the last 12 months, it increased 6.21%.

British Pound Hits 3-year High

The euro pared earlier gains but remained near the $1.14 level after the European Central Bank cut interest rates as expected and downgraded its inflation outlook. The ECB now expects headline inflation to average 2.0% in 2025, 1.6% in 2026, and 2.0% in 2027. The projections for 2025 and 2026 were revised down by 0.3 percentage points from March, mainly due to lower energy price assumptions and a stronger euro. Core inflation (excluding energy and food) is forecast to average 2.4% in 2025 and 1.9% in both 2026 and 2027, largely unchanged from previous estimates. On growth, the ECB sees real GDP rising by 0.9% in 2025, 1.1% in 2026, and 1.3% in 2027. Policymakers noted that inflation is on track to converge sustainably toward the 2% medium-term target, with wage growth slowing and corporate profits helping to absorb cost pressures. The central bank reiterated its commitment to a data-dependent, meeting-by-meeting approach in setting future monetary policy.

Euro Holds Near $1.14 as ECB Cuts Rates and Lowers Inflation Outlook

The South Korean won rose toward 1,360 per dollar this week, hitting a seven-month high as investor sentiment improved after the inauguration of President Lee Jae-myung. Political stability returned following the removal of former President Yoon Suk Yeol, whose Martial Law declaration had shaken markets. Lee’s administration emphasized economic recovery and balancing ties with the US and China, which together account for over 35% of South Korea’s exports. The won also gained as easing global trade risks and US-China talks on tariffs and supply chains boosted demand for Asian currencies. Still, the economic outlook remains cautious. GDP contracted by 0.2% in Q1 2025 due to weak domestic demand and falling exports. Meanwhile, foreign exchange reserves dropped to $404.6 billion in May, reflecting earlier interventions to stabilize the currency. Reports of currency discussions with the US have fueled speculation over future monetary policy shifts to support the won.

South Korean Won Strengthens Amid Political Calm and Global Trade Optimism

The New Zealand dollar rose to around $0.603 on Thursday, extending gains from the previous session, supported by broad weakness in the US dollar. The greenback stuck near six-week lows after weak US economic data reignited concerns about the health of the US economy. Meanwhile, investors remain cautious amid ongoing uncertainty around US trade negotiations, with little progress made ahead of the early July deadline. Market participants will closely watch developments in the US-China trade talks scheduled for later this week. On the domestic front, the Reserve Bank of New Zealand cut its rates by 25bps to 3.25% just last week, but the May decision suggests the easing cycle may be nearing its end. Markets now expect the RBNZ to hold rates steady at its July meeting, while pricing in about a 70% chance of a rate cut in August — which could be the last of the cycle.

New Zealand Dollar Extends Gains

The offshore yuan weakened toward 7.18 per dollar on Thursday, snapping a two-session wining streak, as investors weighed disappointing PMI data and the ongoing US-China trade tensions. A private survey showed that China’s composite PMI fell to a 2-1/2-year low in May 2025, marking the first contraction in private sector activity since December 2022. The decline was driven by the weakness in manufacturing, which overshadowed resilience in the services sector. Adding to the pressure on the yuan were growing uncertainties in US-China relations. President Donald Trump sees direct talks with Chinese President Xi as essential to stopping the trade and technology dispute from escalating. However, Xi insists on meaningful concessions first—a firm stance that has become a growing source of frustration for Trump. At the same time, tensions further escalated due to China's reluctance to relax rare earth exports limits and its accusation that the US is blocking access to advanced technologies.

CNY Weakens on Disappointing Data, US-China Trade Tensions

The Japanese yen held firm around 142.9 on Thursday, after gaining nearly 1% in the previous session, supported by broad dollar weakness following disappointing US economic data. Recent indicators showed a sharp slowdown in private-sector hiring and an unexpected contraction in the US services sector, stoking fears that trade policy uncertainty is beginning to weigh on the broader economy. Domestically, data revealed a fourth consecutive decline in real wages in April, as inflation continued to outpace nominal wage growth. This deepens concerns over Japan’s economic outlook, especially as global uncertainty grows amid rising US tariffs. The weak wage data also complicates the Bank of Japan’s path toward policy normalization. However, BOJ Governor Kazuo Ueda reaffirmed on Tuesday that the central bank remains prepared to raise interest rates if economic and inflation forecasts are met, reinforcing expectations of a gradual tightening cycle.

Yen Strengthens as Dollar Slips on Weak US Data

The Australian dollar held its recent gains around $0.649 on Thursday, as a weaker US dollar and an uptick in China’s services PMI outweighed a decline in domestic trade balance. The greenback remained under pressure amid soft US economic data, with traders awaiting trade and jobless claims figures later in the day. The Aussie found further support after China’s Caixin Services PMI, a key indicator from its largest trading partner, rose to 51.1 in May from 50.7 in April, signaling continued expansion. Meanwhile, Australia’s trade surplus narrowed to AUD 5.41 billion in April, below expectations and down from a revised AUD 6.89 billion in March. The decline was driven by a 2.4% fall in exports and a 1.1% rise in imports. On the geopolitical front, trade developments also drew attention as Trump called it “extremely hard” to deal with Xi, despite earlier suggestions that the two leaders could speak this week, while China eyes a major Airbus deal in a shift toward closer EU ties.

Australian Dollar Holds Ground

The US dollar index remained under pressure below 99 on Thursday, as investors awaited fresh labor market data that could shape expectations for future Federal Reserve policy moves. Markets are focused on Thursday’s weekly jobless claims and Friday’s closely watched nonfarm payrolls report. The greenback came under renewed selling pressure on Wednesday after a string of disappointing economic indicators raised concerns about the strength of the US economy. Notably, the ADP employment report showed the private sector added just 37K jobs in May—well below forecasts and marking the weakest reading in over two years. Meanwhile, the ISM services PMI signaled contraction in May for the first time in nearly a year, reflecting a steep decline in new business and rising input costs—likely exacerbated by recent tariff increases. Adding to the pressure, President Trump continued to call for interest rate cuts, though Fed officials have so far signaled a cautious stance amid elevated uncertainty.

Dollar Holds Decline Ahead of More Jobs Data

The US Dollar Index slipped toward 98.8 on Wednesday, edging closer to Tuesday’s six-week low of 98.6, as a string of weak economic data raised fresh concerns about the US outlook. The latest ISM services PMI showed the sector contracted in May for the first time in nearly a year, dragged down by a sharp drop in new business and a surge in input costs, likely driven by new tariffs. Separately, ADP data revealed that private employers added just 37,000 jobs in May, the slowest pace since March 2023 and far below the expected 115,000. In contrast, Tuesday’s JOLTs report showed job openings unexpectedly rose to 7.39 million in April, surpassing the forecast of 7.1 million. Markets are now focused on Friday’s nonfarm payrolls report for further guidance on the Federal Reserve’s policy path. While President Trump continues to pressure the Fed to cut rates, officials have so far favored a cautious approach amid heightened trade uncertainty.

Dollar Weakens as Soft Data Fuels Economic Concerns

The Canadian dollar strengthened past $1.37 per USD in June, its highest level in nearly eight months, as investors digested the latest BoC decision and lingering tariff concerns. On Wednesday, the Bank of Canada held its policy rate at 2.75 percent, aligned with market expectations, after April’s inflation data showed headline CPI easing below target while core measures remained elevated. Simultaneously, Ottawa’s “intensive and live” negotiations with Washington to secure exemptions from President Trump’s doubled steel and aluminum tariffs have eased fears of a broader trade shock, protecting export-dependent sectors. Rising oil prices, buoyed by OPEC+’s modest July output increase, have further bolstered Canada’s petroleum revenues and tightened terms of trade. Meanwhile, Q1 GDP growth of 2.2 percent annualized and a second consecutive monthly rise in retail sales highlighted broad-based demand, validating the BoC’s decision and reinforcing confidence in Canada’s economic resilience.

Canadian Dollar Strengthens After BoC

The South African rand firmed to around 17.8 per USD, its highest in nearly a week, helped by a softer dollar and encouraging developments on the fiscal budget. A panel of lawmakers backed the National Treasury’s fiscal framework, suggesting the budget may soon be approved after two previous rejections by coalition members over a VAT rate hike. The third budget version presented by Finance Minister Enoch Godongwana in May is now expected to pass. Meanwhile, South Africa’s economy narrowly avoided a contraction in Q1 2025, growing by just 0.1%, down from 0.4% in Q4 2024 but surpassing market forecasts of stagnation, thanks primarily to strength in the agriculture sector.

South African Rand Up to Near 1-Week High

The US Dollar Index edged down to 99.1 on Wednesday, paring some of the previous session’s gains as investors assessed mixed labor market signals ahead of Friday’s closely watched nonfarm payrolls report. ADP data showed private businesses added just 37,000 jobs in May, the weakest hiring pace since March 2023 and well below forecasts of 115,000. In contrast, the JOLTs report revealed job openings unexpectedly rose to 7.39 million in April, up from March’s revised 7.2 million and beating expectations of 7.1 million, indicating continued labor market resilience. Federal Reserve officials have largely signaled support for holding interest rates steady for now, citing trade uncertainty, despite ongoing pressure from President Trump for rate cuts.

Dollar Eases as Markets Weigh Mixed Labor Data

The euro hovered just below the $1.14 mark as investors looked ahead to the European Central Bank’s policy decision on Thursday. A 25 basis point rate cut is widely expected after Eurozone inflation eased to 1.9% year-on-year in May, below both the 2.0% forecast and the ECB’s target for the first time since September 2024. The softer print has fueled speculation of further easing in the months ahead, despite recent hawkish signals from some policymakers advocating a pause. Sentiment was also supported by Germany’s approval of a €46 billion tax relief package for 2025–2029 to stimulate business activity and growth. On the trade front, EU Trade Commissioner Maroš Šefcovic described his meeting with US Trade Representative Jamieson Greer as “productive and constructive,” suggesting the EU could be granted an exemption from President Trump’s decision to double tariffs on steel and aluminum imports to 50%.

Euro Holds Steady Ahead of ECB Rate Cut

The Japanese yen held steady around 143.9 per dollar on Wednesday, following a nearly 1% decline in the previous session, as a pullback in the US dollar helped stabilize the currency. Traders remained cautious ahead of key US labor market reports that could influence the Federal Reserve’s policy stance. Meanwhile, Bank of Japan Governor Kazuo Ueda reiterated on Tuesday the central bank’s willingness to raise interest rates again if economic and inflation forecasts are met, reinforcing expectations of a slow and measured policy normalization. Ueda also noted that Japan’s economy is in a moderate recovery phase, supported by strong corporate earnings and solid business sentiment, though some pockets of weakness persist. Investors now await upcoming labor market and household spending data due later this week for further clues on the domestic economic outlook.

Japanese Yen Steadies Ahead of More US Jobs Data

The New Zealand dollar steadied around $0.60 on Wednesday, after falling 0.6% in the previous session. Investor attention continues to center on ongoing tariff uncertainty and its potential impact on the global economy, following US President Trump’s latest threat to double tariffs on steel and aluminum imports, set to take effect later today. Meanwhile, markets are closely watching for a possible meeting between President Trump and Chinese President Xi Jinping later this week. China is New Zealand’s top trading partner and any developments in Sino-US trade relations could have a significant effect on the Kiwi dollar. Domestically, the Reserve Bank of New Zealand recently trimmed its official cash rate, but the May move suggests the easing cycle may be approaching its end. Markets now expect the RBNZ to hold rates steady at its July meeting, assigning about a 70% probability to a rate cut in August instead — which could mark the final move of the current easing cycle.

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