Forex News
- WTI remains supported as Houthi rebel attacks in the Red Sea escalate.
- The EIA report reveals a surprise build in US stockpiles, but geopolitical risks offset increased supply.
- WTI Crude Oil remains supported by $65.00 support as resistance holds at the 200-day moving average above $68.00.
WTI Crude Oil is trading higher on Wednesday as attacks in the Red Sea overshadow reports of rising supply.
The US Energy Information Administration (EIA)released its weekly inventory report, which revealed that stockpiles increased by 7.07 million barrels over the past week. Expectations had been for the latest report to show a drawdown of 2 million barrels.
The unexpected surge in inventories led to a slight pullback in West Texas Intermediate (WTI) Crude Oil, before it recovered to trade above $67.00 at the time of writing.
Over the weekend, the Organisation of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) announced that they would increase production by 548,000 barrels per day (bpd) in August.
Between April and July, production from members of OPEC+ has already increased by 1.37 million barrels per day. However, despite the additional supply, geopolitical risks, especially in the Middle East, have limited the downside move.
Red Sea attacks and rising risk premiums support higher Oil prices
Houthi rebels launched a coordinated assault on the Greek-owned bulk carrier Magic Seas on Sunday, forcing the crew to abandon the ship before the vessel sank. The attacks intensified on Monday as drones and speedboats targeted a Liberian-flagged, Greek-operated ship, the Eternity C. Several crew members were killed or went missing, and the ship sank in the early hours of Wednesday.
As a result, risk premiums on Oil have increased, underpinning higher prices.
WTI Crude Oil heads toward the 200-day SMA, providing resistance above $68.00
West Texas Intermediate (WTI) crude is trading around $67.54, holding just above the 50% Fibonacci retracement level of the January-April decline at $67.08, which is acting as immediate support.
The price is facing resistance near the 200-day Simple Moving Average (SMA) at $68.16, with a break above this level potentially paving the way for a move toward the 61.8% Fibonacci level at $69.98.
On the downside, support is reinforced by the 100-day SMA at $65.02 and the 50-day SMA at $64.07, which aligns with the 38.2% retracement at $64.18, creating a strong technical floor.
WTI Crude Oil daily chart
Momentum indicators are mixed. The Relative Strength Index (RSI) is reading slightly above the neutral level at 54, while the Commodity Channel Index (CCI) is slightly negative, reflecting caution among bulls. Despite bearish pressure from rising inventories and increased OPEC+ supply, geopolitical risks in the Middle East are helping to keep prices supported near key technical levels.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
- Gold price rebounds above $3,300 ahead of Fed Minutes scheduled for 18:00 GMT.
- President Trump announces the latest round of tariffs, fuelling fresh demand for safe-haven bullion.
- XAU/USD rebounds off triangle support, with the 50-day SMA providing resistance at $3,321.
Gold (XAU/USD) is edging higher after a mild pullback on Wednesday as US President Trump announces the latest round of tariffs, expected to take effect in August.
With markets awaiting the release of the Fed Minutes scheduled for 18:00 GMT, the US Dollar has weakened, allowing XAU/USD to trade above $3,300 at the time of writing.
On Truth Social, Trump announced that imports from Iraq, Libya, and Algeria to the US will face a 30% tariff rate, while levies on imports from the Philippines will be set at 20%.
Meanwhile, the upcoming release of the FOMC Minutes from the June meeting is expected to shed light on the Fed’s internal debate over the path of monetary policy.
In June, the central bank opted to maintain its benchmark interest rate at 4.25% to 4.50%, citing a resilient labor market and lingering inflation pressures.
Last week’s Nonfarm Payrolls (NFP) report reinforced that outlook, showing continued strength in employment and reducing expectations for a near-term rate cut. As a result, yields have firmed across the curve, further strengthening the USD and weighing on Gold.
Gold typically shares an inverse relationship with the US Dollar and interest rates. When yields rise, interest-bearing assets become more attractive relative to Gold, which does not offer a yield. This dynamic has continued to pressure bullion in recent sessions.
Daily digest market movers: Gold hinges on Fed outlook and trade policy
- According to the CME FedWatch Tool, markets are pricing in a 62.9% probability for a 25-basis-point rate cut in September. So far this year, the Fed has maintained interest rates within the 4.25%-4.50% range, supported by a resilient labour market.
- Meanwhile, President Trump continues to criticize Fed Chair Jerome Powell. On Tuesday, Trump called for his “Immediate resignation”. On Truth Social, Trump stated, “Rates should have been cut months ago. The only reason they’re not is because Powell doesn’t want me to win.” These remarks reflect Trump's long-standing frustration with Powell, which began during his first term and has intensified as monetary policy remains tight.
- On tariffs, the Trump Administration has hinted at imposing a 50% tariff rate on Copper imports to the US and a potential 200% levy on pharmaceutical products.
- Letters outlining the reciprocal tariff rates that the Trump administration aims to impose on imports to the US continue to be sent to trading partners of the World’s largest economy.
- This has reignited concerns over the potential economic implications of the levy increase.
- At a Cabinet Meeting on Tuesday, Trump reiterated that there would be no further extension to the fresh tariff deadline on August 1. “Everybody has to pay. And the incentive is that they have the right to deal in the United States. ”Trump wrote on Truth Social that “TARIFFS WILL START BEING PAID ON AUGUST 1, 2025. There has been no change to this date, and there will be no change.”
- On Monday, 14 letters were sent to countries, including Japan and South Korea, outlining the fresh tariff rate. On Tuesday, US Commerce Secretary Howard Lutnick told CNBC that an additional 15 -20 letters were scheduled to be sent to global leaders by Wednesday.
- Trump also threatened BRICS with an additional 10 % tariff. BRICS nations collaborate on various issues, including trade, investment, finance, and sustainable development. They aim to increase their influence in global economic and political affairs. The bloc also holds annual summits to discuss and coordinate strategies for mutual support and growth.
Gold technical analysis: XAU/USD lingers above $3,300
Gold (XAU/USD) is attempting a recovery after reaching a one-week low on Wednesday, which pushed the price to the lower boundary of a symmetrical triangle pattern.
The 38.2% Fibonacci retracement level at $3,292 of the April rally, which has served as a key short-term support level over recent weeks, currently remains intact.
Gold (XAU/USD) daily chart
A sustained move below this level could expose Gold to further losses, targeting the 50% Fibo level at $3,228, followed by $3,164.
On the upside, resistance is aligned at the 50-day Simple Moving Average (SMA) at $3,321 and the 20-day SMA at $3,345.
The 23.6% retracement level is providing an additional barrier of resistance at $3,372, with a move higher opening the door for the $3,400 round number.
The Relative Strength Index (RSI) is holding near 44, reinforcing the emergence of bearish momentum.
The metal’s failure to hold above its moving averages and the triangle apex favour downside continuation, unless bulls can convincingly gain traction above $3,345.
Tariffs FAQs
Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas.
Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers.
There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs.
During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
- EUR/CHF edges lower toward key support zone at 0.9300.
- ECB’s Lane warns of rising risks beyond tariffs, including capital controls and security-related trade barriers.
- Technical indicators reflect a fading bullish momentum as the RSI eases below 50 and the MACD histogram deepens into the red.
The Euro (EUR) weakens against the Swiss Franc (CHF) on Wednesday, with EUR/CHF trading near the lower boundary of its multi-week range around 0.9318. The cross remains under pressure following fresh comments from European Central Bank (ECB) officials that added to the cautious mood around the Euro.
Earlier today, ECB Chief Economist Philip Lane flagged an evolving set of global risks that extend beyond tariffs, highlighting non-tariff trade barriers, capital flow restrictions, and the increasing overlap between security and economic policy. Meanwhile, ECB Deputy Director-General Livio Stracca issued a stark warning that climate-related shocks could wipe out as much as 5% of eurozone GDP over the next five years, comparable in scale to the COVID-19 crisis. These comments reinforce the ECB’s cautious policy stance and could keep investor appetite for the Euro muted, against defensive currencies like the Swiss Franc.
From a technical perspective, EUR/CHF remains trapped in a tight sideways range between 0.9300 and 0.9430 since late April. However, today’s decline puts the cross at risk of breaking below the 0.9300 psychological support zone.
The pair is trading just beneath the 20-day Simple Moving Average (SMA) near 0.9365, which also serves as the middle line of the Bollinger Bands, reinforcing its role as immediate resistance. The inability to reclaim this level signals a lack of bullish bias, especially as the price continues to hover near the lower Bollinger Band, indicating downward pressure.
Momentum indicators are skewed in favor of the bears. The Relative Strength Index (RSI) is slipping toward the 40 mark, indicating weakening buying interest and an increasing risk of a bearish continuation. At the same time, the Moving Average Convergence Divergence (MACD) has turned negative, with the MACD line now comfortably below the signal line and the histogram extending into red territory, indicating fading bullish momentum.
A sustained break below 0.9300 would likely confirm a bearish breakout from the recent range and could accelerate downside toward the April swing low at 0.9223, followed by the psychological 0.9200 level. On the flip side, any recovery attempt would need to clear the 20-day SMA near 0.9365 to shift the short-term bias back toward neutral. Until then, the path of least resistance appears tilted to the downside.
- Pound gains after UK becomes first to seal trade framework with US.
- Euro pressured as EU faces higher proposed tariffs than UK in talks.
- Traders cautious on UK outlook after welfare bill U-turn fuels fiscal concerns.
The EUR/GBP tumbles during the North American session, down by a 0.18% as risk appetite improved due to most US equity indices registering gains as traders brace for the release of the latest Federal Reserve monetary policy meeting minutes. At the time of writing, the cross trades at 0.8622.
Euro weakens to 0.8622 as markets cheer UK–US deal and eye Fed minutes
Financial markets continued to digest US President Donald Trump's trade war, which threatened to broaden tariffs and impose a 50% tariff on copper, as stated on Tuesday. in the meantime, the Pound Sterling benefits after being the first country to seal a trade framework with its US counterpart.
However, traders remain cautious regarding the Pound following last week’s U-turn on the UK welfare bill, which increases the chances that the government will either increase borrowing or taxes to balance the public accounts.
Earlier, the Bank of England released its financial stability report, in which it flagged that risks remain high due to US tariffs.
In the meantime, negotiations between the EU and the US are showing some progress, though it seems that the EU will face higher tariffs than the UK. The EU has agreed to sign a temporary “framework” that will add 10% tariffs to EU goods, while talks continue.
EUR/GBP Price Forecast: Technical outlook
The daily chart suggests that the EUR/GBP pair is set to consolidate around the 0.8600 figure in the near term, despite the ongoing pullback. Although the downward move appears promising, sellers must clear 0.8600, followed by the 20-day SMA at 0.8567. A breach of the latter will expose the 0.8500 mark.
The Relative Strength Index (RSI) remains bullish but indicates that buyers are losing some momentum.
On the other hand, if buyers hold the pair above 0.8600, expect further upside near a downslope resistance trendline at 0.8650/75, before traders reach 0.8700.
Euro FAQs
The Euro is the currency for the 19 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%).
The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde.
Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money.
Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy.
Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Another round of the White House-Federal Reserve dispute saw President Donald Trump urge the Fed to decrease its interest rate by a minimum of 3 percentage points, reiterating his request for the bank to lower rates to alleviate the cost of servicing the nation's debt.
Interest rates FAQs
Interest rates are charged by financial institutions on loans to borrowers and are paid as interest to savers and depositors. They are influenced by base lending rates, which are set by central banks in response to changes in the economy. Central banks normally have a mandate to ensure price stability, which in most cases means targeting a core inflation rate of around 2%. If inflation falls below target the central bank may cut base lending rates, with a view to stimulating lending and boosting the economy. If inflation rises substantially above 2% it normally results in the central bank raising base lending rates in an attempt to lower inflation.
Higher interest rates generally help strengthen a country’s currency as they make it a more attractive place for global investors to park their money.
Higher interest rates overall weigh on the price of Gold because they increase the opportunity cost of holding Gold instead of investing in an interest-bearing asset or placing cash in the bank. If interest rates are high that usually pushes up the price of the US Dollar (USD), and since Gold is priced in Dollars, this has the effect of lowering the price of Gold.
The Fed funds rate is the overnight rate at which US banks lend to each other. It is the oft-quoted headline rate set by the Federal Reserve at its FOMC meetings. It is set as a range, for example 4.75%-5.00%, though the upper limit (in that case 5.00%) is the quoted figure. Market expectations for future Fed funds rate are tracked by the CME FedWatch tool, which shapes how many financial markets behave in anticipation of future Federal Reserve monetary policy decisions.
- EUR/USD edges lower as traders await clues of when the Fed may cut rates.
- Minutes from the June FOMC and changes in rate expectations could serve as an additional catalyst for EUR/USD.
- Euro strength wanes as bullish momentum of the EUR/USD uptrend fades.
The Euro (EUR) is trading flat against the US Dollar (USD) on Wednesday as investors turn cautious ahead of key US economic events.
As markets continue to search for clues about when the Federal Reserve (Fed) may begin cutting rates, the Minutes from the June Meeting and a US Treasury bond auction are in focus.
Ahead of these events, EUR/USD remains in a narrow range with prices hovering above 1.1700 at the time of writing.
US 10-year bond auction and FOMC Meeting Minutes set tone for EUR/USD
The Federal Open Market Committee (FOMC) Meeting Minutes provide details about how Fed Board Members perceive the current economic conditions. It also provides insight into inflation and employment trends, which directly influence expectations for interest rates. As US President Donald Trump continues to call for the "immediate resignation" of Fed Chair Jerome Powell, markets are pricing in a rate cut for September. This has provided some support for US Treasury yields and the Greenback on Wednesday.
Additionally, the US Treasury's 10-year bond auction, scheduled for 17:00 GMT, is drawing considerable market interest.
A bond auction is a process where the US government issues new debt by selling bonds to investors, and its outcome can significantly influence bond yields.
Rising yields typically strengthen the US Dollar by making it more attractive to investors seeking higher returns, which can potentially impact currency pairs such as EUR/USD.
EUR/USD nears 1.1700 as bullish momentum fades
EUR/USD is currently trading above the 1.1700 psychological level after testing a new YTD high of 1.1803 last week. The 20-day Simple Moving Average (SMA) is providing support at 1.1651, just above the 23.6% Fibonacci retracement level of the May-July uptrend near 1.1650.
The Relative Strength Index (RSI) is hovering around 60, indicating that bullish momentum has waned, although the broader tone remains neutral to positive. Immediate resistance lies at the 10-day SMA of 1.1749, which could open the door for the 1.1800 psychological level and the recent swing high of 1.1830.
With support clustered around the 23.6% Fibo retracement and the 20-day SMA, a decisive break below this confluence could expose the pair to further downside toward the 38.2% Fib level at 1.1538.
On the flip side, a move back above 1.1749 would revive bullish momentum and open the door for a retest of the recent peak. Traders are likely to focus on the 1.1650 area for near-term directional cues.
US Dollar FAQs
The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.
The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.
In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.
Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
- GBP/USD slips below 1.3600, struggling to regain momentum after a three-day losing streak.
- BoE’s Financial Stability Report warns of heightened global risks, including geopolitical tensions and sovereign debt stress.
- US Dollar Index hovers near 97.60, with traders eyeing FOMC Minutes for Fed policy signals.
The British Pound (GBP) flattens against the US Dollar (USD) on Wednesday, halting its three-day losing streak despite a steady Greenback as traders react to the Bank of England’s (BoE) latest Financial Stability Report.
The GBP/USD is hovering near the 1.3600 mark, trading around 1.3587 at the time of writing during the American trading session. Meanwhile, the US Dollar Index (DXY), which tracks the value of the US Dollar against a basket of six major currencies, is holding firm, trading around 97.60 as investors await the release of the Federal Open Market Committee (FOMC) Meeting Minutes later on Wednesday.
In its latest Financial Stability Report, the BoE stated that while the UK financial system remains resilient, the global financial outlook has become more challenging. The central bank pointed to persistent geopolitical tensions, fragmented trade flows, and rising sovereign debt pressure as key risks. While global markets have stabilized somewhat following a pause in US tariff escalation, asset valuations remain stretched and vulnerable to sharp corrections, which could potentially impact the cost and availability of finance for UK households and businesses.
Despite these external risks, the FPC assessed that UK banks are well-capitalized and able to support the real economy, even under more severe conditions. Mortgage lending has picked up, reflecting steady household demand.
The Committee opted to maintain the Countercyclical Capital Buffer (CCyB) at 2% but noted that it stands ready to reduce the buffer if domestic conditions weaken. The report also addressed digital finance risks, including stablecoins, emphasizing the need for sound backing assets and price stability. Additionally, the FPC reiterated concerns about vulnerabilities in non-bank financial institutions and called for greater transparency and stronger safeguards across market-based finance.
Looking ahead, market focus will shift to the FOMC Meeting Minutes, due later on Wednesday at 18:00 GMT, which could provide fresh insights into the central bank’s rate path and inflation outlook. Traders will also keep a close eye on any new developments around global trade tensions, especially following recent US tariff threats and the extended deadline for reciprocal measures.
Forex Market News
Our dedicated focus on forex news and insights empowers you to capitalise on investment opportunities in the dynamic FX market. The forex landscape is ever-evolving, characterised by continuous exchange rate fluctuations shaped by vast influential factors. From economic data releases to geopolitical developments, these events can sway market sentiment and drive substantial movements in currency valuations.
At Rakuten Securities Hong Kong, we prioritise delivering timely and accurate forex news updates sourced from reputable platforms like FXStreet. This ensures you stay informed about crucial market developments, enabling informed decision-making and proactive strategy adjustments. Whether you’re monitoring forex forecasts, analysing trading perspectives, or seeking to capitalise on emerging trends, our comprehensive approach equips you with the insights needed to navigate the FX market effectively.
Stay ahead with our comprehensive forex news coverage, designed to keep you informed and prepared to seize profitable opportunities in the dynamic world of forex trading.
