Forex News

United Overseas Bank (UOB) strategists Quek Ser Leang and Lee Sue Ann note USD/SGD has stabilised after an earlier sell-off, with spot around 1.2905 and intraday price action expected to stay confined between nearby support and resistance. They highlights building downside momentum on a 1–3 week horizon, with 1.2860 as a key trigger for a deeper decline, while 1.2930 caps the topside.

Dollar-Singapore pair stuck in tight band

"24-HOUR VIEW: USD fell to a low of 1.2876 two days ago. When it was at 1.2885 in the early Asian session yesterday, we highlighted that “the sharp increase in momentum points to further downside, but any decline is expected to face firm support at 1.2860.” We also noted that “the 1.2875 level is expected to offer support as well.” Our view did not materialise as USD rebounded to 1.2912 before closing 0.18% higher at 1.2908 (+0.18%). USD appears to have entered a range-trading phase, most likely between 1.2890 and 1.2920."

"1-3 WEEKS VIEW: Two days ago (15 Jul, spot at 1.2910), we highlighted that “while there is scope for USD to weaken, given that there is no clear increase in downward momentum, any decline could be contained within a 1.2860/1.2955 range.” After USD dropped to a low of 1.2876, we highlighted the following yesterday (16 Jul, spot at 1.2885): “Downward momentum is starting to build, and should USD close below 1.2860, it could trigger a deeper decline. On the upside, a breach of 1.2930 (‘strong resistance’ level) would mean that the risk of further downside has eased.” Our view remains unchanged."

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

The upcoming week will be dominated by the European Central Bank’s (ECB) interest rate decision, United Kingdom (UK) inflation and labor market figures, and preliminary global Purchasing Managers Index (PMI) data. Australian employment, New Zealand inflation and Canadian CPI figures will also attract attention.

The US Dollar Index (DXY) trades slightly higher near 100.80 after mixed United States (US) economic releases. The United States (US) calendar will be relatively light, leaving the Greenback sensitive to Federal Reserve (Fed) expectations, global risk sentiment, and developments in energy markets.

US Initial Jobless Claims are expected to rise slightly to 212K from 208K on Thursday. On Friday, attention will turn to the preliminary S&P Global PMIs and New Home Sales. The previous Composite PMI stood at 51.9, with Manufacturing at 53.9 and Services at 51.2. Stronger activity figures could support the US Dollar, while weaker data may extend its recent loss of momentum.

EUR/USD trades lower near 1.1440 ahead of a busy Eurozone calendar. German producer inflation will be released on Monday, followed by Germany’s ZEW surveys and the European Central Bank (ECB) Bank Lending Survey on Tuesday. German Economic Sentiment is expected to improve to 18.0 from 10.5, while the Current Situation Index is forecast to rise to -77.8 from -81.0.

The ECB is expected to leave its Main Refinancing Operations Rate unchanged at 2.40% and the Deposit Facility Rate at 2.25% on Thursday. Investors will closely examine the policy statement and press conference for guidance on inflation and possible additional rate increases. Friday’s preliminary French, German and Eurozone PMIs will provide further evidence about the region’s economic momentum.

GBP/USD trades lower near 1.3450 with Sterling facing several important domestic releases. Tuesday’s labor report is expected to show earnings excluding bonuses rising 3.4%, while earnings including bonuses are forecast to increase 4.5%. Employment is projected to rise by 100K, with the Unemployment Rate remaining at 4.9%.

UK inflation follows on Wednesday. Core CPI is expected to ease to 2.5% YoY from 2.6%, while headline inflation previously stood at 2.8%. Retail Sales and preliminary PMIs will be released on Friday. A hotter inflation or wage report could strengthen expectations that the Bank of England (BoE) will maintain restrictive policy, while weaker employment and consumption figures may pressure the Pound Sterling.

USD/JPY holds near 162.50, keeping markets attentive to the possibility of intervention by Japanese authorities. Japan’s trade report is expected to show exports rising 18.6% YoY and imports increasing 21.0%, with the overall trade deficit narrowing to approximately ¥120 billion.

Japanese inflation will also be closely watched later in the week. CPI excluding fresh food is forecast to rise 1.6% YoY, up from 1.4%. Stronger inflation could support expectations of additional Bank of Japan (BoJ) tightening and offer some relief to the Japanese Yen.

AUD/USD trades lower near 0.6980 ahead of Wednesday’s Australian labor market figures. Employment is expected to increase by 15K in June, slowing sharply from the previous 40.3K gain, while the Unemployment Rate is forecast to remain unchanged at 4.4%.

Australian preliminary PMIs will follow on Thursday. The previous Composite PMI stood at 50.4, with Manufacturing at 51.5 and Services at 50.5. China’s interest rate decision on Sunday will also be relevant for the China-sensitive Australian Dollar, with the People’s Bank of China expected to keep its benchmark rate unchanged at 3.0%.

West Texas Intermediate (WTI) Oil trades near $82 per barrel, rising almost 3% as geopolitical risks keep supply concerns elevated. Oil will remain sensitive to developments in the Middle East and preliminary global PMIs, which could influence expectations for future energy demand.

Gold advances near $4,015, supported by geopolitical uncertainty and demand for defensive assets. However, stronger global activity or inflation figures could lift government bond yields and limit the precious metal’s recovery.

Anticipating economic perspectives: Voices on the horizon

Tuesday, July 21:

• ECB’s Nagel

Friday, July 24:

• ECB’s Lane

Central banks meetings and upcoming data releases

The People’s Bank of China will announce its interest rate decision on Sunday, July 19, with the benchmark rate expected to remain unchanged at 3.0%.

The ECB will announce its monetary policy decision on Thursday, July 23. The Main Refinancing Operations Rate is expected to remain at 2.40%, while the Deposit Facility Rate is forecast to stay at 2.25%. The policy statement will be followed by ECB President Christine Lagarde’s press conference.

• Gold price gets a boost yet remains poised to finish the week with losses of over 2.50%.
• US-Iran escalation supports safe-haven demand despite equity recovery.
• Fed’s Hammack and Jefferson keep tightening risks alive.

Gold edges higher by some 0.92% on Friday as the US-Iran conflict boosted energy prices, which ultimately drive inflation higher, increasing expectations that the Federal Reserve (Fed) might need to raise interest rates. At the time of writing, the XAU/USD trades at $4,013, after reaching a daily low of $3,959.

XAU/USD rises as Middle East escalation revives inflation fears

Attacks between the US and Iran soured market sentiment despite the ongoing recovery in US equity markets. Newswires revealing a further escalation of the war are pushing the non-yielding metal higher.

Axios reported that the Trump administration is sending dozens of additional refueling planes to Israel in preparation for a potential expansion of military operations.

Data-wise, the University of Michigan Consumer Sentiment for July improved. From 50.7 to 54, due to lower gasoline prices at the pump, the report revealed. Inflation expectations for one year dipped from 4.6% in June to 4.2%, and for five years were steady at 3.3%.

Aside from this, Cleveland Fed President Beth Hammack was hawkish and expressed concern about persistent high inflation, which is at the top of her list, adding that “inflation is too high.” Hammack added that the labor market is solid and that “growth numbers are good and consumer spending is stable.”

On Thursday, the Fed’s Vice Chair Philip Jefferson said he is open to raising rates if there is no progress toward disinflation.

Money markets estimated a nearly 61% probability of a Fed rate increase at the October 28 meeting, based on Prime Terminal data. For the July meeting, the central bank is anticipated to keep rates steady, with a 76% probability.

Next week, the US economic docket will feature jobs data and S&P Global Flash PMIs as Fed officials entered their blackout period ahead of the July 29 policy meeting.

XAU/USD technical outlook: Gold recovers but remains bearish

Gold price is bearishly biased as the downtrend extends despite XAU reclaiming the $4,000 mark after bouncing off $3,959. Nevertheless, momentum remains negative as the Relative Strength Index (RSI) is bearish below its 50-neutral level. This signals that further XAU/USD downside is seen, unless buyers clear key technical resistance levels.

For a bearish continuation, the first support is the psychological $4,000. Below this level lies the low of the day at $3,959, ahead of $3,900. A breach of the latter will expose the October 28, 2025 swing low at $3,886.

Conversely, for a bullish reversal, Bullion needs to break above a descending resistance trendline between $4,125 and $4,175. Above this area, and a potential test of the 50-day Simple Moving Average (SMA) at $4,291 is on the cards. Beyond that, the 200-day SMA at $4,495 stands as the next obstacle, and once surpassed it could open the way to $4,500.