Forex News

ING strategist Frantisek Taborsky says Central and Eastern European FX will be driven by secondary data and policy expectations. A dovish National Bank of Poland stance and market pricing of future rate cuts are seen weighing on the Zloty, with ING’s models pointing EUR/PLN closer to 4.340. By contrast, ING remains constructive on the Koruna and Forint despite near-term regional weakness.

Zloty lags as koruna and forint supported

"Thursday’s National Bank of Poland press conference struck a clearly dovish tone, which should weigh on the zloty for a bit longer. The market is pricing almost a full rate cut further out, with more than a 50% probability assigned to the September meeting."

"Rates are still searching for a new equilibrium, but the rate differential in our models points closer to 4.340 in EUR/PLN, with upside risk."

"Despite the sharp weakening in recent days, we remain bearish on PLN this week and beyond. Weekend headlines from the Middle East point to a risk-off opening today, which should add pressure across the region."

"We remain bullish on the koruna, backed by a hawkish Czech National Bank, and on the forint, which is recovering from the global sell-off amid a still solid domestic backdrop – but near-term weakness across CEE FX looks likely."

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

• The Indian Rupee declines to an over six-week low at around 95.70 against the US Dollar due to multiple headwinds.
• Surging Oil prices could push the Indian Rupee to an all-time low at around 97.10 against the US Dollar.
• Investors await the US CPI data for June and Fed Chair Warsh's testimony.

The Indian Rupee (INR) trades significantly lower against the US Dollar (USD) on Monday. The USD/INR jumps to over a six-week high around 95.70 as renewed Middle East hostilities have strengthened oil prices.

In India's afternoon trading session, the MCX Crude Oil contract expiring on July 20 is up 2.4% to near Rs. 6,980.

Currencies from economies, such as India, which rely heavily on oil imports to meet their energy needs, tend to underperform in a high oil price environment.

US strikes over 300 Iranian targets in the last three days

Earlier in the day, the US Central Command (CENTCOM) reported that forces had already struck more than 300 Iranian targets over three nights, including 140 on Saturday alone, per Reuters. The Iranian media has also confirmed several explosions near Sirik, west of Bandar Abbas, Qeshm, and Jask. US forces also stated that strikes were aimed to cripple Iran’s ability to attack civilian ships in the Strait of Hormuz, a critical chokepoint to almost 20% of the global energy supply.

In the wake of renewed aggression between the US and Iran, the appeal of safe-haven assets has improved.

As part of retaliation, Iran announced over the weekend that the Hormuz would now be closed “until further notice”.

India's CPI rises strongly in June

On the domestic front, India's retail Consumer Price Index (CPI) data arrives at 4.38% Year-on-Year (YoY) in June, higher than 4.3% estimates and the May reading of 3.93%. Signs of rising inflationary pressures would prompt expectations of interest rate hikes by the Reserve Bank of India (RBI).

This week, investors will also focus on the US inflation data for June, which is scheduled to be released on Tuesday. The US core CPI – which excludes volatile food and energy items such as food and energy – is seen rising at a steady pace of 2.9% YoY.

Apart from the US CPI data, investors will also pay attention to comments from Federal Reserve (Fed) Chair Kevin Warsh in his two-day testimony before the Treasury Committee, which will start on Tuesday.

FIIs invested a significant amount on Friday

Foreign Institutional Investors (FIIs) remained net buyers in the Indian stock market on Friday, investing a significant amount of Rs. 2,603.72 crore. This is the highest one-day buying seen since June 19.

The interest of foreign investors in the Indian equity market seems to be improving in the past few weeks with the kickstart of the first quarter earnings season of FY2026-27. So far in July, foreign investors have remained net buyers in five out of eight trading sessions.

Analysts at Goldman Sachs see ample room for foreign flows to return to India, clarifying that India's outlook has improved in recent weeks amid lower commodity prices, a stable currency, resilient domestic growth, and healthy earnings expectations. The investment banking firm expects reasonably valued pockets like large-caps and banks will likely gain the most if the foreign outflows reverse course.

Technical Analysis: USD/INR holds Descending Triangle breakout

USD/INR trades higher at around 95.70, keeping a constructive near-term bias as it holds well above the 20-day Exponential Moving Average (EMA) at 95.18. The pair also holds the breakout of the Descending Triangle formation.

The Relative Strength Index (RSI) at 58.05 leans toward bullish momentum without yet signaling overbought conditions, suggesting buyers remain in control.

On the downside, initial support is seen at the 20-day EMA near 95.18, which lines up with the short-term bullish trend and could attract dip-buying interest. A deeper pullback would expose the former downtrend break zone around 94.50, ahead of the rising trend-line region between roughly 94.12 and 94.06, where a loss of this band would undermine the current bullish tone and open the door to a more pronounced correction.

Looking up, the pair would attempt to revisit the all-time high around 97.10 if it manages to break above the July 9 high at 95.96.

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

India’s retail Consumer Price Index (CPI) rises at an annualized pace of 4.38% in June, stronger than 4.3% estimates and the previous reading of 3.93%.

Market reaction

No strong reaction is seen in the Indian Rupee (INR) following the release of the India's CPI data. At press time, USD/INR trades higher at around 95.60.

UOB’s Quek Ser Leang and Lee Sue Ann observe that AUD/USD has been range‑trading slightly higher than expected, with intraday levels seen between 0.6920 and 0.6960. The earlier tentative upside momentum has faded, and for the next 1–3 weeks the pair is expected to trade between 0.6890 and 0.6975. On a 1–3 month horizon, AUD/USD remains negative, with focus below 0.6835 toward 0.6707.

Aussie Dollar stuck in tight range

"24-HOUR VIEW: We expected AUD to range-trade between 0.6920 and 0.6955 last Friday. However, AUD traded within a higher range of 0.6934/0.6969. AUD closed at 0.6950 (+0.12%), but it opened on a soft note today. We are unable to derive much from the price action. Today, AUD could trade between 0.6920 and 0.6960."

"1-3 WEEKS VIEW: We highlighted last Tuesday (07 Jul, spot at 0.6955) that “upward momentum is building tentatively, and the risk of AUD breaking above 0.6980 is increasing and will continue to increase as long as AUD holds above the ‘strong support’ level, now at 0.6900.” On Friday (10 Jul, spot at 0.6935), we indicated the following: “Since then, AUD has not been able to make any headway on the upside, and the buildup in momentum has faded. From here, AUD is likely to trade in a range between 0.6890 and 0.6975.” There is no change in our view."

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

Societe Generale strategists note that India’s June Consumer Price Index (CPI) release will be important for bond markets, with the 10-year IGB yield holding near its 200-day moving average around 6.71%. They highlight that inflation is expected to rise modestly, while robust FPI inflows and a narrower trade deficit support the Indian Rupee (INR), but do not ensure a sustained move away from the 95.23 level on the 50-day moving average.

INR supported but still constrained

"In EMs, June CPI data for India due later today will be closely watched by bond markets with the 10y IGB yield anchored at the 200dma (6.71%). Yields have retraced almost 43bp from the May peak."

"Inflation is forecast to have edged up to 4.2% in June from 3.93% in May, although robust FPI inflows have continued following the investment incentives announced by the RBI and MinFin in early June."

"Middle East conflict and oil prices should exert a greater influence in the near term."

"The narrowing of India’s trade deficit in June should provide support to the INR but does not guarantee a move away from 95.23 (50dma)."

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

BNY’s Geoff Yu argues that United Kingdom (UK) assets, including the British Pound (GBP) and gilts, will react more to the choice of chancellor under incoming Prime Minister Andy Burnham than to the leadership change itself. Yu stresses that markets are focused on fiscal sustainability, with real gilt yields attracting domestic demand but limited foreign interest.

Fiscal path key for gilts and Pound

"Andy Burnham will likely be confirmed as the U.K.’s seventh prime minister in 10 years in the coming days, and he would take office the week of July 20."

"For GBP and gilt markets, the identity of the next chancellor is far more significant, as they’re looking at binary outcomes with respect to a significant deviation from the November budget or the broad status quo."

"The political challenges involved mean that “early” doesn’t mean major changes until the next general election – a new mandate for adjustment is required first."

"For gilt investors, we do not expect a major change in current flow dynamics: real rates are attracting strong domestic buying, but international interest is nonexistent."

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

• AUD/USD wavers around 0.6950 with the immediate bullish trend in play.
• The US Dollar remains on the defensive on Monday, despite rising geopolitical tensions.
• The Aussie Dollar has broken above the descending trendline resistance.

The Australian Dollar (AUD) posts marginal losses against the US Dollar (USD) on Monday, as the pair's reversal from Friday's 0.6970 highs found support above 0.6120. Rising tensions in Iran have hammered risk appetite, but the US Dollar’s weakness is keeping the Aussie from retreating further.

US and Iran escalated hostilities over the weekend, and Tehran announced the closure of the Strait of Hormuz, boosting Crude prices. This adds pressure to central banks to hike interest rates in order to contain inflation, in a context of sluggish global growth.

The Aussie, however, is drawing some support from the US dollar’s weakness. Risk aversion has failed to support the Greenback on Monday, as investors await the US Consumer Price Index (CPI) release, due on Tuesday, and the testimony of Federal Reserve (Fed) Chairman Kevin Warsh to the US Congress.

Technical Analysis: Aussie breaks the descending trendline

AUD/USD trades at 0.6941, holding a constructive near-term bias after breaking and confirming above the trendline resistance from early June highs. The four-hour Relative Strength Index is trading back and forth around 50, while the Moving Average Convergence Divergence (MACD) hovers near the zero line, highlighting a lack of a clear bias.

On the topside, Bulls need to break Friday's highs, in the 0.6970 area and the 38.2% Fibonacci retracement of the May-June selloff, at 0.7020, to confirm a bullish reversal and target the Mid June highs around 0.7085. On the downside, session lows at 0.6923 are likely to provide some support ahead of the broken trendline, at 0.6880 and the June 30 low at 0.6865.

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

Silver prices (XAG/USD) fell on Monday, according to FXStreet data. Silver trades at $58.72 per troy ounce, down 1.92% from the $59.87 it cost on Friday.

Silver prices have decreased by 17.40% since the beginning of the year.

The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 69.39 on Monday, up from 68.82 on Friday.

(An automation tool was used in creating this post.)

Rabobank strategist Michael Every discusses rising geopolitical risks around the Strait of Hormuz after the apparent collapse of a US-Iran memorandum of understanding. Every notes both sides are now striking each other, with United States (US) strategy shifting to escorted energy flows. Despite this, markets currently assume the US can act militarily without significant Oil price pain, helped by Strategic Petroleum Reserve (SPR) use and weak Chinese Oil demand.

Hormuz tensions and Oil risk window

"The US-Iran MoU [Memorandum of Understanding] appears to have collapsed sooner than we had thought."

"With both sides striking the other, US efforts will turn to ensuring energy can flow through Hormuz ‘the hard way’ via escorting ships through it."

"For now, markets are saying the US can ‘comfortably bomb’ and ‘there is no pain’ even if the ‘MoU are receding’, mostly due to finite SPR drains and low Chinese oil imports."

"That gives the US a window for action: if it can keep enough oil flowing through Hormuz, which is our base case, it underlines military action can move markets in a desired direction; if it fails, we face a far larger energy crisis with far less in the tank as mitigants - or a geostrategic reckoning."

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

ING analysts Chris Turner, Frantisek Taborsky and Francesco Pesole note that higher energy prices and tensions in the Gulf are supporting the Dollar against low-yielding currencies. They highlight that US energy independence and live Fed tightening prospects underpin Dollar strength. ING expects the Dollar to stay in demand versus the Euro, Japanese Yen and Swiss Franc, with DXY seen grinding higher.

Dollar stays supported by energy

"In the G10 space, the dollar is holding up well, and the macro story should keep it supported. US energy independence will come back to the fore if Iran is effective in re-closing the Strait of Hormuz. And this time around, US rates should rise along with overseas rates given that prospects of Fed tightening are now live."

"Tomorrow sees the June CPI, where headline inflation is set to drop month-on-month. But with energy prices rising again and core inflation probably rising at 2.8/2.9% year-on-year, it looks too early for the market to price out a Fed rate hike this year."

"With energy prices turning bid again and no signs of an imminent slowdown in US activity to take the sting out of higher prices (keeping Fed tightening prospects alive), the dollar should hold onto its gains. Expect it to be favoured against low-yielding energy importers such as the euro and the yen. And in a world of higher interest rates, the Swiss franc lags."

"USD/CHF can retest last month's high at 0.8140, while DXY can grind to 101.50."

"The deteriorating situation in the Gulf and the rise in energy prices are supporting the dollar against the low-yielders, including the euro. Worryingly for Europe, natural gas prices are creeping higher again at a time of low inventories. In the absence of direction from the Fed, higher energy prices will keep tightening fears alive and the dollar in demand."

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