Forex News

• WTI reverses more than $3.50 off the session low, trading above $82.00.
• Hormuz transits down to four inbound and none outbound on Monday.
• Iran conditions full reopening on a June memorandum that has lapsed.

Crude Oil trades just above $82.00 and 1.78% higher on the session, which is not where it was heading. West Texas Intermediate opened short of $81.00, extended a three-session slide to a low just short of $79.50 in the European morning, then reversed more than $3.50 to a session high short of $83.00 after 16:00 GMT. The selling was a response to a headline about the Strait of Hormuz, and the buying was a response to reading what that headline actually says.

The market sold a headline and bought back the terms

Iran and Oman announced a temporary joint maritime corridor through the strait with mine clearance attached, and the barrel gave up roughly 6% across three sessions on it. The wires wrote that up as war premium unwinding. The terms published alongside the announcement do not support the reading.

The corridor is described as temporary and joint, which means Tehran keeps a hand on traffic rather than surrendering it. Iran's deputy foreign minister said the same day that the waterway will not fully reopen until Washington meets its commitments under the June memorandum, an agreement that has since lapsed. A corridor conditioned on the other side honouring a dead document is a negotiating position, not a supply schedule.

The fee question is the part the price eventually noticed. Tehran has run a permission-and-payment regime through the closure, with reported charges of $1 million to $2 million a voyage, and frames those as service charges rather than tolls because maritime law bars tolls on an international strait while permitting charges for services actually rendered. Muscat wants any such charge voluntary and Tehran wants it mandatory, and that gap remains open.

The body that would collect on the Iranian side was designated in May, so a corridor with a fee attached asks a compliant charterer to transact with a sanctioned counterparty before it asks anything of a freight desk. That is a legal problem rather than a shipping one, and it does not resolve on a joint statement.

The transit count went the wrong way

The number that decides the argument is not the price but the transit count, and it has moved in the opposite direction to the tape. Vessels crossing the Strait of Hormuz have declined since August 22, from as many as 20 inbound, 14 outbound and three crossings in dark mode down to as few as four inbound, none outbound and three dark by Monday, against a prewar reference north of 100 a day.

A market took 6% off the barrel across three sessions while physical flow through the chokepoint fell to nothing outbound. Roughly 65% of the Crude Oil leaving through the strait is bound for China, so the leg that matters most to seaborne balances is the one that has stopped. Announcements move the screen and hulls move the barrels, and this week the two have been travelling in opposite directions.

The 50-day Exponential Moving Average (EMA) near $81.50 was lost on the way down and reclaimed on the way back, making it a pivot rather than a trend line for the second time this month. The 200-day near $78.50 has not been tested since the first week of August. Everything today happened inside an August band running roughly $74.00 to $87.00, so a $3.50 reversal is noise at the range level and information at the narrative level.

What the week still has to price

The domestic side of the barrel got firmer today rather than softer. Headline Personal Consumption Expenditures (PCE) prices ran 3.7% over the year against a 3.6% consensus, personal income rose 0.4% against 0.3%, and every price line in the second-quarter revision landed above forecast, including a quarterly core reading marked up to 3.7% from 3.4%. A barrel back above $82.00 into that is a passthrough problem rather than a relief.

Thursday brings initial jobless claims at 12:30 GMT, expected at 208K from 206K, and little else. Friday stacks the Chicago Purchasing Managers Index (PMI) at 13:45 GMT at a consensus of 57 from 57.6, ahead of a 14:00 GMT block carrying the chair's Wyoming keynote, final August Michigan sentiment expected at 51, and one-year household inflation expectations against a 4.3% prior. That last figure is the one a firm barrel threatens.

Levels and bias

Resistance: The session high short of $83.00 is the first line and the tape has faded from it once already. Above that the mid-August shelf near $84.50 is the level that would confirm the reversal, with the August peak around $87.00 and the late-July high just above $92.00 as the distant ceiling.

Support: The 50-day EMA near $81.50 is the level to hold now that it has been reclaimed. Beneath it $80.00 is the next round number, and the session low just short of $79.50 is the line the whole reversal rests on. Below that the 200-day EMA near $78.50 is the first structural floor.

Bias: Bullish above the session low just short of $79.50, because a market that sold a reopening for three sessions and took $3.50 back inside four hours has repriced the terms rather than the headline, and the daily Stochastic Relative Strength Index (Stoch RSI) near 73 is climbing rather than stretched. Objectives are the mid-August shelf near $84.50 and then $87.00. Invalidation comes on a daily close beneath $79.50, which would put the 200-day EMA near $78.50 back in play.

WTI daily chart

Scotiabank strategists Shaun Osborne and Eric Theoret highlight that the Canadian Dollar (CAD) is slightly softer, tracking broader USD gains and weaker Oil, while USD/CAD trades almost exactly at their fair value estimate near 1.3862. New Canadian retaliatory tariffs on US goods have checked a minor CAD bounce, but the impact is expected to be limited. Technically, USD/CAD holds above its 200-day moving average, with support seen near 1.3825/30 and 1.3775/85.

CAD drifts lower yet stays near fair value

"The CAD is tracking a little lower, in line with the NOK, reflecting broader USD gains and weaker oil prices."

"Canada announced retaliatory 15-50% tariffs on USD20bn of US products, effective September 8th, in response to the latest tariff blast from the US. No surprise but the news checked the minor bounce in the CAD yesterday but the impact is likely to remain limited."

"Trade tensions risk hurting investment in North America generally. A report yesterday said Honda told an industry roundtable group that it may not build any new plant in North America unless CUSMA was renewed. Both sides are still—apparently—talking and have left time for an off-ramp to be located if there is a will to do so."

"There has been a minor deterioration in underlying CAD fundamentals this morning but spot continues to stick limpet-like to our fair-value estimate (1.3862)."

"The intraday DMI oscillator is stuck in neutral. USD may still stretch a little more towards mid/upper 1.39s. Support is 1.3825/30 and (stronger) 1.3775/85."

"Neutral—There is little change in the CAD’s technical position. The USD as held the push above the 200-day MA (1.3842) to gain a small psychological advantage but the downtrend in place from late June remains intact while daily and weekly trend oscillators remain bearish."

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

• USD/CHF advances as the US Dollar gains following the latest US inflation report.
• Uncertainty surrounding the Strait of Hormuz keeps Oil prices and inflation risks in focus.
• Switzerland’s soft inflation backdrop leaves the SNB on course to maintain its zero-interest-rate policy.

The Swiss Franc (CHF) weakens against the US Dollar (USD) on Wednesday as the Greenback attracts buyers following the release of the latest United States (US) inflation data. Traders also remain attentive to developments in the Middle East. At the time of writing, USD/CHF trades around 0.8052, up roughly 0.47% on the day.

The headline Personal Consumption Expenditures (PCE) Price Index rose 0.2% MoM in July, exceeding the 0.1% forecast and reversing June’s 0.1% decline. On an annual basis, headline inflation remained at 3.7%, above market expectations of 3.6%.

Meanwhile, the core PCE Price Index, the Federal Reserve’s (Fed) preferred measure of underlying inflation, increased 0.2% MoM, matching expectations but accelerating from the 0.1% rise recorded in June. Annual core inflation held steady at 3.3%, also in line with forecasts.

Although the inflation figures reinforced expectations that the Fed will leave interest rates unchanged at its upcoming meeting, inflation remains well above the central bank’s 2% target. At the same time, tensions in the Middle East are keeping Oil prices elevated and clouding the inflation outlook, leaving the possibility of an interest-rate hike on the table.

The US Dollar Index (DXY), which tracks the Greenback's value against a basket of six major currencies, trades around 99.16, up nearly 0.25% on the day. The Greenback came under selling pressure last week after the US Treasury unexpectedly announced an increase in buybacks of longer-dated government securities, reviving concerns about rising debt and fiscal credibility.

On the geopolitical front, Iran and Oman have yet to finalise an agreement covering transit through the Strait of Hormuz, a senior Iranian source told Reuters. Tehran maintains that the US must lift its naval blockade and that the war must end before normal shipping through the vital waterway can resume.

US President Donald Trump also told Al Jazeera that there is no timetable to resume peace talks with Iran, adding that both economic pressure and military action are working.

On the Swiss side, the ZEW Survey Expectations Index improved to 12.1 in August from 10.0 previously. However, Switzerland’s subdued inflation backdrop supports expectations that the Swiss National Bank (SNB) will keep its policy rate at 0% throughout the year, limiting support for the Swiss Franc.

• GBP/USD drops below 1.3600 as the US Dollar rebounds after PCE.
• Core PCE holds steady, keeping December Fed hike bets elevated.
• Warsh’s Jackson Hole speech could clarify the Fed’s policy path.

The Pound Sterling (GBP) retreats about 0.39% on Wednesday as the US Dollar (USD) stages a recovery after a US inflation report showed prices remain elevated, keeping the chances of a Federal Reserve (Fed) rate hike toward the end of the year. The GBP/USD pair exchanges hands below 1.3600 after reaching a high near 1.3651.

GBP/USD slips as firm PCE, stronger data lift Dollar before Jackson Hole

US economic data revealed that the Core Personal Consumption Expenditures (PCE) Price Index in July was in line with estimates and unchanged from June’s 3.3% YoY. Headline PCE steadied at 3.7% YoY, above estimates of 3.6%.

Other data showed that the US economy grew at a 1.5% annual pace in Q2 2026 as expected, while Durable Goods Orders doubled June’s print of 0.5%, coming in at 1.1% MoM and exceeding forecasts.

After the data, the US Dollar Index (DXY), which tracks the performance of the buck’s value against a basket of six currencies, is up 0.27%, at 99.17. US Treasury yields also rose, with the 10-year benchmark note edging up four basis points to 4.664%, while investors increased their hawkish bets on the Fed.

Money markets have priced in a narrow 39% chance of a rate hike in the September meeting, according to Prime Terminal. But for December, they had priced in 27 basis points (bps) of tightening, with the odds at 74% for a 25-bps increase.

Now eyes will be on Fed Chair Kevin Warsh's speech on Friday at the Jackson Hole Symposium.

In the UK, the economic schedule was absent on Wednesday, yet GBP/USD is leaning on global developments, market sentiment, broader market dynamics, and US developments.

Ahead, the US economic docket will feature Initial Jobless Claims on Thursday, followed by the University of Michigan Consumer Sentiment Index, and Warsh’s speech.

GBP/USD Price Forecast: Technical outlook

In the daily chart, GBP/USD trades around 1.3594, maintaining a constructive bullish tone as price holds above the cluster of reclaimed trend-line breaks and the 50/100/200-day simple moving averages (SMA) grouped near 1.3410. The pair is also supported by the former downward resistance line broken at 1.3396 and the secondary rising trend-line break at 1.3390, while the Relative Strength Index (RSI) around 60 suggests positive but not overstretched momentum.

On the topside, initial resistance emerges at the rising support trend-line break now acting as a cap near 1.3628, ahead of the horizontal barrier at 1.3676, which marks a more significant hurdle for bulls. On the downside, immediate support is seen at the reclaimed descending trendline break around 1.3490, with the dense moving-average and trendline cluster between 1.3410 and 1.3390 expected to underpin the broader bullish bias on any deeper pullback.

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

• DJIA holds just beneath 53,500, roughly 2.3% under the August record.
• Every second-quarter price line revised up, real growth left at 1.5%.
• July real consumer spending flat: nominal 0.2% against PCE prices 0.2%.

The Dow Jones Industrial Average (DJIA) trades a shade beneath 53,500 and roughly 100 points lower in the session on Wednesday, after a 12:30 GMT data drop the wires filed as uneventful. July core Personal Consumption Expenditures (PCE) prices rose 0.2% on the month and 3.3% over the year, both in line with consensus, and that is the figure rate expectations key off. The revisions to the second quarter printed at the same minute on the same page, and none of those were in line.

The quarter got dearer without getting bigger

The second estimate of second-quarter Gross Domestic Product (GDP) left real output exactly where the advance reading put it at the end of July, at an annualised 1.5%. Every price measure attached to that output moved higher. The GDP price index went to 6.4% from 6.3%, quarterly headline PCE prices to 5.3% from 5.1%, and quarterly core PCE prices to 3.7% from 3.4%, with all three above a consensus that expected no revision at all.

The reading is not ambiguous, because the statisticians found no additional output in the quarter and found that the output already counted cost more than first estimated. The whole revision landed in the deflator. A 0.3pp upward move in quarterly core prices is a bigger number than the monthly core print the market spent the morning parsing, and it drew no coverage whatsoever.

This is the second time in a month that the quarterly price data carried the surprise while the monthly data carried the headlines. The advance estimate on July 30 put the GDP price index at 6.3% against a 3.6% consensus, easily the largest miss on that release page, and the tape traded the in-line monthly core instead. The same figure has now been revised higher and drawn the same shrug.

Income arrived and the spending did not

The household side of the release is where the price revision stops being an accounting curiosity. Personal income rose 0.4% in July against a 0.3% consensus, personal spending rose 0.2% in line, and the monthly PCE price index also rose 0.2%. Nominal spending grew by precisely the amount prices grew, which leaves real consumer spending flat on the month.

Income beating spending by two tenths, with prices absorbing all of the spending that did occur, means households banked the difference rather than consuming it. That is not the behaviour of a consumer comfortable about the second half, and it follows a preliminary August sentiment reading that gave back two months of improvement in a single print.

Durable goods orders looked strong at 1.1% against a 0.7% consensus until the transportation line comes out, at which point the reading drops to 0.4% and misses. The cleaner capital-spending gauge is worse, with nondefense capital goods orders excluding aircraft slowing to 0.2% in July from 1.2% in June.

Business investment strength was the evidence the Fed chair reached for at the July press conference when defending the current stance, and a full percentage point of deceleration in the core orders book is the first crack in it. Prices revised up, real spending flat and capital orders slowing is a stagflationary combination, and the market has priced it as benign.

Two events the index has not seen yet

None of that is what the index is actually trading, because the two events that decide this week both sit off the economic calendar. Nvidia (NVDA) reports after the bell with consensus at $2.09 a share on revenue near $92.28 billion, and the number will be read as a verdict on the artificial intelligence capital cycle rather than as one component's quarter. As a card-carrying member of the Dow Jones Industrial Average, .

Friday brings Fed Chair Warsh's first keynote at the annual Jackson Hole symposium. The published theme is financial innovation and payments, which constrains the academic papers rather than the keynote, and desks have spent the week arguing over whether a chair who has stripped forward guidance from the statement, skipped the July projections, and floated fewer meetings per year will use twenty minutes in August to say anything about September.

The long end has been the market's actual decision-maker for a month and offers no comfort into either event. The thirty-year rate printed its highest in nearly two decades last week and sat at 5.23% on the Federal Reserve constant maturity series on Monday, easing only marginally from there. An index within roughly 2.3% of a record while thirty-year money costs more than at any point since before the financial crisis is the same unresolved trade it has been all month.

Levels and bias

Resistance: The session high in the 53,700 area is the first line and it has already turned the tape back once today. Above it the 53,800 cap that has held since mid-August is the level that matters, with the early-August ledge near 54,100 and the record just short of 54,750 beyond that.

Support: The session low just above 53,400 is the immediate floor, with the 53,200 area beneath it as the first real shelf. Below those the 53,000 handle opens and the 52,800 area that marked last week's low becomes the objective a genuine failure carries, with the 50-day Exponential Moving Average (EMA) near 52,600 underneath.

Bias: Bearish while the 53,800 area caps, because four sessions bought back roughly 600 points off last week's low and the fifth has stalled beneath the 53,700 area with the daily Stochastic Relative Strength Index (Stoch RSI) near 44 and turning down out of the upper band. That is a recovery losing its author rather than a base being built. Objectives are the 53,200 area then the 53,000 handle, and invalidation comes on a daily close above 53,800.

Dow Jones daily chart

• A reported US-Iran ceasefire that would reopen the Strait of Hormuz is easing energy-cost fears and lending the Euro a modest bid against the Pound.
• The Eurozone data slate is busy later this week, with German unemployment due.
• Reports say Iran moved its military doctrine onto a more offensive footing.

EUR/GBP is trading around 0.8570 on Wednesday, on the front foot as hopes of a de-escalation in the Gulf hand the Euro (EUR) a modest lift. The pair has broken above its 20- and 100-period moving averages, which sit bunched together near 0.8558 on the 4-hour chart, and is testing the session high in the 0.8574 area.

Russian agency RIA Novosti reported on Tuesday that Washington and Tehran had agreed to a ceasefire that would restore free navigation through the Strait of Hormuz, the route that carried about a fifth of the world's Oil and liquefied natural gas (LNG) before the conflict, with an announcement expected in the coming days. For the energy-importing Euro area, the prospect of calmer shipping lanes and softer fuel costs is a relative positive, and it is helping the single currency edge ahead of the Pound (GBP).

Reports that Iran has moved its military doctrine onto a more offensive footing, and that talks with Oman over managing the strait remain on-and-off, are keeping the move measured. Traders look set to wait for the deal to be confirmed before pricing it in fully.

German unemployment figures are due on Friday, with the jobless rate expected to hold at 6.4% in July, ahead of the Eurozone's August confidence surveys.

With the United Kingdom (UK) calendar quiet, Sterling is left to trade off the broader risk mood, leaving the initiative with the Euro for now. A solid set of Eurozone surveys, or formal confirmation of the Hormuz reopening, could see EUR/GBP extend toward the 0.8575 region.

Short-term technical analysis:

On the 4-hour chart, EUR/GBP trades at 0.8571, retaining a mild bullish bias as it holds above both the 20-period and 100-period Simple Moving Averages (SMAs) clustered around 0.8558. The Relative Strength Index (RSI) near 61 hints at firm but not overextended upside momentum, while immediate topside pressure emerges from the nearby horizontal resistance at 0.8574.

On the downside, initial support appears at the latest close around 0.8571, with a dense demand zone forming between the horizontal levels at 0.8565, 0.8562 and 0.8560, ahead of the SMA base near 0.8558. On the topside, a clear break above 0.8574 would open the way for further gains, keeping the short-term constructive tone intact as long as price stays over the underlying moving average cluster.

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

Prashant Newnaha at TD Securities notes that the RBA’s August minutes were overall less hawkish than June, but still emphasized upside inflation risks and the possibility of preemptive tightening. With July CPI strong and further data due before the September meeting, he underscores that the Board faces a choice between acting early or waiting for more comprehensive Q3 inflation readings.

Board weighs preemptive tightening

"Our interpretation of the RBA's August Statement and Minutes were overall less hawkish than the communication at the Bank's June meeting."

"That said, the hawkish element in the August minutes was the discussion around the Bank possibly acting preemptively and hiking."

""Members noted that if the risks around the inflation forecast were judged to be significantly skewed to the upside, it may be appropriate to mitigate those risks somewhat by tightening monetary policy pre-emptively.""

"Today's CPI outcome certainly adds weight to the discussion around the potential for the RBA delivering a hike by year-end and possibly as early as next month."

"We concede today's CPI release lines up the Sep RBA Board meeting as live, with the Nov meeting as the next likely month the RBA potentially hikes. Our on-hold call is looking less tenable."

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

• NZD/USD falls 0.60% on Wednesday as the US Dollar finds some support following US inflation data.
• Headline Personal Consumption Expenditures inflation stands at 3.7% YoY in July, slightly above the 3.6% expected.
• The New Zealand central bank’s hawkish stance helps limit pressure on the Kiwi ahead of its monetary policy decision.

NZD/USD retreats to around 0.5940 on Wednesday at the time of writing, down 0.60% on the day. The New Zealand Dollar (NZD) loses ground against the US Dollar (USD), which finds some support following the release of the latest United States (US) inflation data.

The Bureau of Economic Analysis (BEA) reports that the Personal Consumption Expenditures (PCE) Price Index rises 3.7% YoY in July, unchanged from June but slightly above the 3.6% expected by markets. On a monthly basis, the index increases by 0.2%.

The core PCE Price Index, which excludes volatile food and energy components and is an inflation gauge closely watched by the Federal Reserve (Fed), remains steady at 3.3% YoY, in line with expectations. The core index also rises by 0.2% MoM.

The slight upside surprise in headline inflation provides some support to the Greenback, as persistent price pressures could encourage the Fed to maintain a restrictive monetary policy stance. However, the reaction remains limited as the core measure delivers no surprise and the report does not appear to significantly alter expectations for the September meeting.

According to the CME FedWatch tool, markets price in around a 36% chance of an interest-rate hike at the Fed’s next meeting, a level broadly similar to the one seen before the PCE data release.

Investors now turn their attention to Fed Chair Kevin Warsh’s speech on Friday at the Jackson Hole Economic Policy Symposium. His comments could provide fresh clues about how the US central bank assesses persistent inflation and its policy intentions ahead of the September decision.

On the New Zealand side, the monetary policy outlook nevertheless provides some support to the Kiwi and could help limit the decline in NZD/USD. Markets anticipate a 25-basis-point interest-rate hike from the Reserve Bank of New Zealand (RBNZ) at its monetary policy meeting next week, a move that would bring borrowing costs to 3% if delivered.

The divergence between an RBNZ that could tighten monetary policy further and a Fed whose next move remains more uncertain could therefore limit downside pressure on the New Zealand Dollar, even as the US Dollar benefits in the short term from slightly firmer-than-expected inflation data.

NZD/USD technical analysis

In the one-hour chart, NZD/USD trades at 0.5937, retaining a mildly bearish near-term tone as it sits below the 100-period simple moving average (SMA) at 0.5964 while holding just above the 200-period SMA at 0.5933. The pair is slipping away from recent highs, and the Relative Strength Index (RSI) near 32 approaches oversold territory, hinting that downside pressure persists but may begin to lose momentum if sellers fail to drive a clean break lower.

On the downside, immediate support is seen at the 200-period SMA at 0.5933, followed by the horizontal floor at 0.5925, where buyers could attempt to stem further losses. On the topside, initial resistance emerges at the 100-period SMA at 0.5964, ahead of the more significant horizontal barrier at 0.5985, and only a move above this upper cap would ease the current bearish bias and open the way for a more sustained recovery.

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