Recently, the US President Donald Trump posted on his Truth Social network that Iran violated the ceasefire, after launching drones at ships in the Strait of Hormuz, with one of them hitting the upper deck of a large cargo-carrying ship.
EUR/USD trades on the front foot on Friday but remains on track for a second straight weekly loss as the fragile situation in the Middle East and hawkish Federal Reserve (Fed) outlook keep the US Dollar's (USD) downside limited.
The Pound Sterling gains 0.20% against the Greenback as the latter recoils after hitting year-to-date (YTD) highs, with money markets pricing in a less hawkish Federal Reserve, despite policymakers stating they will focus on inflation.
AUD/USD is recovering near 0.6900 on Friday as the US Dollar (USD) weakens with investors taking profits ahead of the end of the semester after a two-week rally in the Greenback. The move helped the Australian Dollar (AUD) recover some intraday ground, although the full picture remains negative.
Standard Chartered economists Hunter Chan and Shuang Ding note that China’s fiscal spending has underperformed so far in 2026, weighing on growth despite stronger-than-expected Q1 data.
UOB’s Lee Sue Ann highlights that Australia’s unemployment rate dipped to 4.4% in May with a 40.3k employment gain, mainly in part-time jobs, and participation rising to 66.7%.
Societe Generale economists Reo Sakida and Jin Kenzaki analyze June Tokyo Consumer Price Index (CPI), noting that overall inflation dynamics in Japan changed little from May despite a modest upside surprise in headline and core readings.
GBP/JPY trades in a narrow range on Friday as traders weigh the latest UK political developments against lingering intervention risks from Japanese authorities, with USD/JPY holding above the 161.00 level.
BNY’s Geoff Yu highlights that South Korean equities have delivered exceptional returns in 2026 while institutional investors remain net sellers, particularly from the Americas.
USD/JPY edges lower on Friday and trades around 161.60 at the time of writing after once again failing to sustain a move above the 162.00 mark. The pair is facing profit-taking as investors remain cautious over the risk of intervention by Japanese authorities to support the domestic currency.
Commerzbank strategists note that despite lower Oil and gas prices, European Central Bank (ECB) officials still signal at least one more rate increase, which the bank forecasts for September.
Bart Melek at TD Securities argues that Strait of Hormuz disruptions have driven Oil inventories to historically low levels, leaving Brent oversold and vulnerable to a sharp short-covering rebound.
Lee Hardman at MUFG highlights that the Japanese Yen remains near year-to-date lows versus the US Dollar, with intervention risks limiting further weakness.
HSBC strategists describe Malaysia as relatively resilient to elevated Oil prices thanks to its status as a net energy exporter and beneficiary of the AI (Artificial intelligence) hardware cycle.
Geoff Yu at BNY identifies Indonesia as one of the clearest cross-asset signals in Emerging Markets (EM) APAC (Asia-Pacific).
Gold (XAU/USD) holds above the $4,000 mark on Friday as the US Dollar (USD) softens following the latest US Personal Consumption Expenditures (PCE) inflation report, which broadly met forecasts and reduced expectations of a near-term Federal Reserve (Fed) interest rate hike.
Commerzbank’s Bernd Weidensteiner argues that despite market expectations for further Fed tightening, falling Oil and gasoline prices should lower U.S. inflation and ease pressure for hikes.
OCBC’s FX strategists Sim Moh Siong and Christopher Wong highlight that Brent Oil has dropped sharply on optimism over the reopening of the Strait of Hormuz after a US–Iran deal, but warn markets may be underpricing security risks.
NZD/USD trades around 0.5650 on Friday, up 0.05% at the time of writing, as the New Zealand Dollar (NZD) remains under pressure despite a weaker US Dollar (USD) following the latest US inflation data.
USD/CHF edges lower on Friday, retracing all the gains recorded this week as the US Dollar (USD) rally loses momentum following the latest US Personal Consumption Expenditures (PCE) data, which broadly came in line with expectations and showed that underlying inflationary pressures remain relatively
TD Securities’ Head of Commodity Strategy Bart Melek highlights that Gold recently broke below $4,000/oz as higher US rates and a firmer Dollar weigh on the metal.
EMEA FX Strategist Frantisek Taborsky at ING says the Czech National Bank’s (CNB) June minutes confirm it as the most hawkish central bank in the region after its 25bp hike to 3.75%. Markets price another hike as core inflation risks persist.
HSBC strategists highlight Singapore’s strong 1Q26 Gross Domestic Product (GDP) growth, driven by robust electronics exports, construction and services, making it one of ASEAN’s fastest-growing economies. Despite the energy shock, inflation remains contained for now.
MUFG’s Lee Hardman notes the US Dollar is set for a second straight week of gains but has lost upward momentum as softer US GDP and PCE data, plus dovish comments from New York Fed President Williams, reverse recent hawkish repricing.
Commerzbank’s commodity team, led by Barbara Lambrecht, warns that recent declines in Oil prices may prove temporary as tanker traffic through the Strait of Hormuz is only gradually recovering and US inventories sit well below seasonal norms.
Silver (XAG/USD) steadies on Friday as the US Dollar (USD) and Treasury yields retreat after the latest US Personal Consumption Expenditures (PCE) inflation data showed underlying inflation remained relatively contained.
OCBC’s FX strategists Sim Moh Siong and Christopher Wong note Gold is tentatively stabilising after a sharp selloff, with prices back above USD4,000 and some dip-buying interest emerging as Dollar and real yield pressures ease.
UOB’s Lee Sue Ann notes that Australia’s May labour data show a rebound in headline employment but softer underlying conditions, with rising underemployment and falling hours worked.
TD Securities strategists note that United States (US) rates markets steepened after weaker headline Personal Consumption Expenditures (PCE) Price Index, while stronger personal income and spending data complicated the picture for the US Dollar (USD).
The British Pound (GBP) is trading higher against the US Dollar (USD) for the second consecutive day on Friday, as the US Dollar’s rally faltered, with Oil prices returning to pre-war levels.
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