Forex News

• USD/CHF snaps two-day slide after defending 50-day SMA support.
• RSI crosses above neutral, confirming buyers regain near-term control.
• Break above 0.8150 exposes 0.8200 and yearly high.

The USD/CHF snaps two days of losses and rises by over 0.60% on Thursday after solid US jobs data. Also, buyers stepped in at key support at the 50-day Simple Moving Average (SMA) of 0.8052, pushing the pair back above the 0.8100 threshold.

USD/CHF Price Forecast: Technical outlook

The USD/CHF uptrend remains intact, with the market structure of higher highs and higher lows, continued to be respected. Also, momentum, as depicted in the Relative Strength Index (RSI) shows that buyers are in control, as the index crosses above its 50-neutral level.

Given the backdrop, the pair faces key resistance at 0.8150. Once breached, a move towards 0.8200 is on the cards. Above lies the yearly high of 0.8207, which once cleared, would extend the USD/CHF rally towards the June 4, 2025, cycle high at 0.8250. Up next is 0.8300.

On the downside, the first support for USD/CHF would be at 0.8100. If spot prices fall below the 50-day SMA at 0.8052 emerges as the next floor level, followed by the 0.8000 mark. 

USD/CHF Price Chart – Daily

Iranian Fars News agency revealed on Thursday details of a plan being negotiated by Iran and Oman to manage the Strait of Hormuz, under which ships belonging to the US, Israel and other “hostile” countries would be prohibited from transiting the waterway. 

According to Farse News, the draft states that countries and individuals that have caused damage to Iran will not receive permission to pass through the Strait until compensation is paid.

Additionally, heavy fines would be imposed for violations, up to 20%, and the government, working alongside the armed forces, would have to take on duties including guiding navigation, overseeing vessel traffic, and safeguarding the security and environment of the Persian Gulf.

Market’s reaction

West Texas Intermediate (WTI), the US crude benchmark, jumped from around $75.65 to $77.00, up nearly 3.30% so far in the day, following the news report.

• Silver falls about 1.7% on Thursday, trading near $60.95 as the US Dollar rebounds.
• The US Dollar Index rises 0.30% to around 100.00 ahead of Friday's Nonfarm Payrolls report.
• Investors await the US labor market data, which could reshape expectations for Fed monetary policy.

Silver (XAG/USD) trades lower at around $60.95 on Thursday at the time of press, down 1.73% on the day. The precious metal is facing profit-taking as the US Dollar (USD) regains momentum, with the US Dollar Index (DXY) advancing about 0.30% to trade near the psychological 100.00 level.

The stronger US Dollar reduces Silver's appeal for holders of other currencies. At the same time, safe-haven flows continue to support the Greenback as investors monitor ongoing geopolitical tensions in the Middle East, despite reports that Iran and Oman are moving closer to a temporary agreement on shipping through the Strait of Hormuz.

Investors also remain focused on developments in the Oil market. Hopes that supply disruptions could ease continue to support expectations of lower Oil prices, a scenario that would help contain global inflation pressures and reduce the likelihood of monetary tightening by major central banks.

Market attention is now turning to Friday's US Nonfarm Payrolls (NFP) report. Following mixed labor market indicators earlier this week, including a weaker-than-expected ADP Employment Change report, the official employment figures are expected to play a key role in shaping expectations for the Federal Reserve's (Fed) monetary policy path as investors continue to reassess the outlook for interest rates.

Traders will also closely monitor the reaction in US Treasury yields and the US Dollar following the NFP release, as both remain the main short-term drivers for Silver prices.

XAG/USD technical analysis

In the one-hour chart, XAG/USD trades at $60.94, retaining a mildly neutral-to-bearish tone as the metal holds above the 100-period simple moving average (SMA) at $59.76 and the 200-period SMA at $58.88, yet remains capped by a descending trend-line resistance coming in around $61.59. The Relative Strength Index (RSI) near 39 suggests fading upside momentum after the recent pullback, hinting that rallies towards the trend-line could struggle unless buyers regain control.

On the downside, initial support is seen around the previously resistance $60.00 level, with the 100-period SMA at $59.76 and the longer-term 200-period SMA at $58.88 reinforcing a broader demand zone ahead of the more distant horizontal floor at $56.60. On the topside, the downwards-sloping resistance trend line at $61.59 is the first barrier bulls need to clear to ease the current cap on prices and open the way for a more constructive short-term recovery towards the recent high at $62.91.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

• Layoffs in the US hit a two-year low, reinforcing a solid labor-market backdrop.
• Hormuz uncertainty keeps geopolitics central before Friday’s NFP release.
• UK construction PMI improves, though sector remains in contraction territory.

The Pound Sterling (GBP) holds firm against the US Dollar (USD) during the North American session on Thursday, after US jobs data reinforces the thesis that the labor market remains solid ahead of Friday’s Nonfarm Payrolls report. The GBP/USD pair trades at 1.3466, after bouncing off daily lows of 1.3404.

GBP/USD holds near 1.3460 as jobless claims hit two-year lows

The US Department of Labor reported that Initial Jobless Claims for the week ending August 1 came in at 199K, exceeding the prior week’s print but below estimates of 202K. Earlier, the Challenger job cuts showed that planned layoffs tumbled 27% to 33.429K in July, its lowest level since July 2024. 

Therefore, US economic data releases during the day suggest that the Federal Reserve (Fed) could remain laser-focused on tackling high inflation, which has so far remained five years above the 2% goal.

Eyes shift to Nonfarm Payrolls, which are expected to come at 80K, above June’s 57K print. Alongside this, the Unemployment Rate is projected to remain steady at 4.2%, below the Fed’s 4.5% target towards the end of 2026.

Meanwhile, geopolitics is expected to continue to drive the markets, as a possible deal between Iran and Oman could reopen the Strait of Hormuz. Nevertheless, an Iranian Journalist reported that the intermediary contact between the US and Iran is false and that Iran-Omani negotiations set the rules for sailing through the Strait of Hormuz.

Recently, the details of the Iran-Oman deal had leaked, and according to the draft, vessels belonging to the US, Israel and hostile countries, through Hormuz, will be prohibited.

In the UK, the S&P Global Construction PMI rose to 44.7 last month from June’s 38.4, showing an improvement despite the ongoing slowdown in the sector, as builders turned more optimistic since the pre-Middle East war.

GBP/USD Price Forecast: Technical outlook

In the daily chart, GBP/USD trades at 1.3458, maintaining a mildly bullish near-term bias as spot holds above the reclaimed descending trend line around 1.3441 and the clustered 50/100/200-day simple moving averages (SMA) near 1.3365. Price also sits comfortably over the higher rising trend support drawn from 1.3140 around 1.3316, while the Relative Strength Index (RSI) at 56.7 stays above the neutral 50 line, hinting that upside momentum is still constructive though not overstretched.

On the topside, initial resistance emerges at the descending trend line from 1.3653, now intersecting near 1.3523, ahead of the higher upward-sloping trend barrier around 1.3554, where buying pressure could start to fade. On the downside, immediate support is seen at the prior resistance trend line turned floor around 1.3441, followed by the multi-period SMA cluster near 1.3365 and then the lower rising trend support around 1.3316, where bulls would be expected to defend the broader constructive structure.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

(This story was corrected on August 6 at 16:35 GMT to say that US layoffs hit a two-year low in July, not Initial Jobless Claims.)

Standard Chartered economists Hunter Chan and Shuang Ding highlight that China’s urban surveyed unemployment rate has remained in a 5.0-5.4% range over the past three years, yet broader labour underutilisation has risen. They estimate a 7.1% underutilisation rate in 2024 and argue that unstable jobs, income and limited social protection are weighing on household consumption growth.

Underemployment and consumption pressures

"China’s urban surveyed unemployment rate has hovered in a narrow 5.0-5.4% range over the past three years, despite slower growth momentum, a prolonged property downturn and elevated external uncertainty."

"Meanwhile, persistently weak consumer confidence, soft consumption growth and elevated youth unemployment suggest the headline measure may not have fully captured job-market challenges, particularly the rise in discouraged workers and underemployment."

"The broader labour underutilisation rate, including the unemployed and those who have stopped looking for work because they believe no jobs are available (similar to U-4 in the US), reached as high as 7.1% in 2024, according to our estimate."

"Meanwhile, although flexible workers (such as delivery riders, ride-hailing drivers and gig workers, estimated at 280mn in 2025) are counted as employed, they often face lower income stability, weaker labour protection and incomplete social security coverage compared with traditional employment, likely dampening consumption appetite."

"We believe better labour protection and social security coverage for flexible workers can help reduce precautionary savings, while vocational training and reskilling support can help mitigate the shock from economic transformation and AI advancement."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• USD/CAD rebounds above 1.4000 as the US Dollar snaps a two-day losing streak.
• Traders await employment reports from the United States and Canada.
• The lack of a final Hormuz agreement keeps Oil prices and inflation risks elevated.

USD/CAD rebounds on Thursday after briefly slipping below the key 1.4000 support level, as the US Dollar (USD) snaps a two-day losing streak with traders repositioning ahead of Friday's employment reports from the United States (US) and Canada. At the time of writing, the pair trades around 1.4030, up 0.12% on the day.

The US Nonfarm Payrolls (NFP) report is expected to show that the economy added 80K jobs in July, up from 57K in June, while the Unemployment Rate is forecast to hold at 4.2%.

The NFP report follows back-to-back softer US labour-market releases earlier this week, including the ADP Employment Change and JOLTS Job Openings data. However, figures released on Thursday showed Initial Jobless Claims rising only slightly to 199K from 198K and coming in below the 202K forecast.

In Canada, employment is projected to rise by 15K following an 18.2K increase in June, with the Unemployment Rate expected to remain unchanged at 6.5%.

In the meantime, tensions in the Middle East keep broader market sentiment fragile. Iran and Oman are close to finalizing an agreement that would establish a temporary shipping route through the Strait of Hormuz, but no final deal has been announced. Tehran also denies holding direct talks with the United States, even as Washington says negotiations are taking place.

As a result, energy-driven inflation risks remain in focus as Oil prices halt their recent decline. West Texas Intermediate (WTI) Crude Oil trades around $77.00 per barrel, up nearly 3.5% on the day.

• XAU/USD trades near $4,260 on Thursday, slightly off $4,304 intraday high.
• WTI trades higher as Tehran cautions that a shipping framework would not automatically reopen the Strait of Hormuz.
• US labor layoffs are down heading into Friday's NFP print.

Gold (XAU/USD) extends Wednesday's 4% spike on Thursday, trading around $4,260 and holding near a seven-week high as a softer US Dollar (USD) and retreating Treasury yields reinforce the metal's recovery. What distinguishes Thursday's session is that Gold is climbing alongside Crude Oil rather than against it.

Iranian Deputy Foreign Minister Kazem Gharibabadi told the Islamic Republic News Agency (IRNA) that the agreement would not automatically reopen the waterway. According to a senior Gulf official, there is a 50% chance that Iran and Oman will reach a deal by Friday. Meanwhile, United States (US) Vice President JD Vance told Fox News that talks with Iran were "messy," calling Iranians "extraordinarily difficult people." Reuters has separately reported that the proposal could hand Tehran control over inbound traffic, a formulation Washington has repeatedly rejected.

Thursday's releases were more mixed, with Initial Jobless Claims at 199K against the 202K consensus and Challenger Job Cuts easing to 33.4K from 45.8K, describing a labor market cooling through slower hiring rather than rising layoffs. Softer employment data have trimmed the odds of a September Federal Reserve (Fed) hike, a straightforward tailwind for a non-yielding asset.

Friday's Nonfarm Payrolls report is the immediate hurdle as a Reuters survey points to an 80K gain in July after June's 57K, with the Unemployment Rate steady at 4.2%.

Technical Analysis:

On the 4-hour chart, XAU/USD trades at $4,253, maintaining a bullish near-term bias as price holds above both the 20-period Simple Moving Average (SMA) at $4,146 and the 100-period SMA at $4,073. The cluster of horizontal supports at $4,248 and $4,232 sits just beneath the market, reinforcing the constructive structure, while the Relative Strength Index (RSI) at 72 signals overbought conditions that could temper immediate upside momentum.

On the topside, initial resistance appears at $4,276, ahead of a stronger barrier at $4,304, where fresh buying would be needed to extend the rally. On the downside, the first layer of support is seen at $4,248, followed by $4,232, with the 20-period SMA at $4,146 and the 100-period SMA at $4,074 providing deeper structural demand if a corrective pullback unfolds.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

Scotiabank highlights that the Euro is slightly softer versus the Dollar after touching levels last seen in mid-June, with fundamentals still supportive as yield spreads turn. Spot has nearly converged with their fair value based on the 2-year Germany–US spread. Further EUR/USD gains likely need a shift in relative central bank expectations or improved sentiment, with near-term range seen at 1.1500–1.1600.

Euro aligns with yield-spread fair value

"The EUR is entering Thursday’s NA session with a fractional 0.1% decline vs. the USD, trading defensively following an overnight push to a fresh local high reaching levels last seen in mid-June."

"Fundamentals remain supportive and the EUR’s recent recovery has closely mirrored the turn in yield spreads. Spot EUR has largely closed the gap to our FV estimate narrowly based on the 2Y Germany-US yield spread, which currently stands at 1.1538."

"Further gains will likely require some further shift in the outlook for relative central bank policy or an improvement in sentiment, as risk reversals reveal a continued premium for protection against EUR weakness."

"In data, the second-tier euro area retail sales figures have offered a slight disappointment for June but were balanced by stronger German factory orders—neither release appears to have had any impact on spot."

"Bullish—the latest recovery in the RSI is important, climbing into bullish territory with a push to the low 60s. The gains in spot have delivered a fresh multi-week high reaching levels last seen in mid-June, however we continue to note the persistence of near-term resistance around 1.1550. We look to a near-term range bound between 1.1500 and 1.1600."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)

• USD/JPY trades near 159.20 on Thursday, retracing part of last week's intervention-driven drop.
• Initial Jobless Claims came in at 199K against the 202K forecast, while Challenger Job Cuts eased to 33.4K in July from 45.8K.
• Markets look to Friday's Nonfarm Payrolls, with consensus near 80K and the Unemployment Rate seen unchanged at 4.2%.

USD/JPY trades modestly higher near 158.20 on Thursday, extending a fourth session of Japanese Yen (JPY) softness as the pair claws back ground lost to last week's coordinated Japan-United States (US) intervention.

The intervention afterglow is fading as Thursday's US labor data offered little to redirect the pair. Initial Jobless Claims fell to 199K, undershooting the 202K consensus and sitting a shade above the prior 198K, keeping layoffs historically subdued. Challenger Job Cuts for July dropped to 33.429K from 45.849K, reinforcing a picture of a labor market cooling through weaker hiring rather than accelerating separations.

Friday's Nonfarm Payrolls (NFP) report will overshadow the prior data however. A Reuters survey of economists points to an 80K gain in July after June's 57K, with the Unemployment Rate holding at 4.2%, Average Hourly Earnings holding at 0.3% on the month and 3.5% on the year, and the average workweek steady at 34.3 hours. Forecasts span a wide 75K-120K band, and several houses see the jobless rate ticking up to 4.3%. The wage component may carry more weight than the headline given the hawkish drift in Federal Reserve (Fed) commentary: Governor Lisa Cook said on Wednesday she was open to the idea that the central bank may need to raise rates to address inflation she described as too high.

Iranian Deputy Foreign Minister Kazem Gharibabadi told the Islamic Republic News Agency (IRNA) that the agreement would not automatically reopen the Strait of Hormuz. According to a senior Gulf official, there is a 50% chance that Iran and Oman will reach a deal by Friday. Meanwhile, US Vice President JD Vance told Fox News that talks with Iran were "messy," calling Iranians "extraordinarily difficult people."

Short-term technical analysis:

On the 4-hour chart, USD/JPY trades at 158.20. The pair is consolidating just under the horizontal barrier at 158.28, while the 100-period Simple Moving Average (SMA) at 161.52 remains a much higher cap, keeping the broader tone in check. On the downside, price holds above the 20-period SMA at 157.57, with the Relative Strength Index (RSI) hovering near 47, hinting at neutral momentum after the recovery from near oversold conditions.

On the topside, immediate resistance is seen at 158.28, followed by the 100-period SMA near 161.52, where stronger supply could re-emerge. On the downside, initial support is located at 157.90, ahead of the 157.71 horizontal floor and the 20-period SMA at 157.57; a deeper slide would expose the next support level at 157.34.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

The Indian Rupee (INR) has found local support against the US Dollar (USD), with USD/INR easing to around 95.10 following the Reserve Bank of India’s (RBI) decision to hold its benchmark repo rate steady at 5.25% for a fourth consecutive meeting. Retaining its neutral policy stance, the RBI characterized recent inflation blips as supply-driven while upgrading its growth projections and trimming its medium-term inflation expectations. Supported by lower crude Oil prices and over $40 billion in recent foreign capital inflows, the Indian currency has gained a firm near-term buffer. However, institutional analysts caution that elevated US Treasury yields and geopolitical oil volatility could limit further downside for USD/INR.

Institutional Analysis: Commerzbank vs. OCBC

Here is how analysts at Commerzbank and OCBC view the primary macro drivers and technical outlook for USD/INR:

• Policy Decision & Stance: Both institutions highlight the RBI's unanimous vote to hold the repo rate at 5.25% under a neutral stance, opting to preserve policy flexibility as inflation pressures remain largely supply-driven.
• Macroeconomic Adjustments: Commerzbank notes the RBI trimmed its FY2026-2027 inflation forecast to 5.0% (from 5.1%) while raising GDP growth projections to 6.7% (from 6.6%), citing resilient domestic demand.
• Capital Inflows & Balance of Payments: OCBC emphasizes that recent regulatory measures attracted nearly $41 billion in capital inflows ($36.7bn via FCNR deposits, $2.57bn in overseas foreign currency borrowings, and $1.5bn in swap facilities), putting India's balance of payments on track for a healthy surplus.
• Technical & FX Landscape: Commerzbank stresses that despite near-term relief, the Rupee remains one of Asia's weaker performers this year. OCBC observes intact bearish momentum on the daily USD/INR chart with RSI near oversold territory, flagging support at 95.00 and 94.70/74 alongside overhead resistance at 95.40 and 95.70.

Supply-driven inflation lets RBI maintain policy flexibility

According to Charlie Lay at Commerzbank, the RBI's wait-and-see stance highlights a clear divergence from several Asian peers that have embarked on rate hikes to combat energy and currency pressures. Even though June CPI picked up to 4.4% YoY, policymakers view the move as temporary and concentrated in food and energy, showing little evidence of broad-based pass-through. This assessment has prompted markets to pare back aggressive tightening bets, driving the probability of an October rate hike down significantly.

"Although June CPI rose above RBI's 4% target to 4.4% yoy, the central bank views the recent increase as largely supply-driven, with limited pass-through into underlying inflation... The interest rate markets have also pared back expectations of near-term tightening. The probability of an October rate hike fell to around 58% from over 90% before the meeting."

Heavy capital inflows and balance of payments surplus buffer the Rupee

Echoing this neutral-to-supportive view, Christopher Wong and Sim Moh Siong at OCBC note that the RBI’s capital-attraction initiatives have successfully bolstered foreign exchange reserves and banking system liquidity. Combined with Governor Sanjay Malhotra's commitment to keep the exchange rate market-determined while curbing excessive volatility, the domestic currency is well-positioned to weather near-term shifts. However, external factors — namely US monetary policy expectations and fluid US-Iran geopolitical risks — remain key hurdles to extended currency gains.

"The RBI also shared that its recent measures had attracted nearly USD41bn of capital inflows... This puts India’s balance of payments on track for a healthy surplus and can support banking system liquidity... Together with lower oil and the sharp rise in reserves, this gives the INR a firmer near-term buffer, although choppy oil prices amid fluid US-Iran geopolitical developments and still-elevated US Treasury yields on worries of Fed tightening may still restrain gains in INR."

Banks anticipate a cushioned Rupee capped by global yields and Oil risks

Based on the combined findings of both financial institutions, the banks project a stabilized near-term environment for USD/INR centered around the 95.00 handle. Commerzbank expects the RBI to remain comfortably on hold as lower Oil prices and massive capital inflows ease immediate pressure on the Rupee. Meanwhile, OCBC highlights that while technical support at 95.00 and 94.70/74 (100-day Simple Moving Average) could be tested in the short run, upside resistance at 95.40 and 95.70 will keep the pair locked in a defined trading range until global yield and energy dynamics settle.

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)