Global FX markets leaned toward the USD as high oil prices and Hormuz risk kept inflation in focus
📌 FX moved through a heavy event week as the Fed, BoE, BoC, ECB and BoJ all kept rates unchanged, but none gave markets enough comfort to price in quick easing. Brent crude holding above 100 USD per barrel kept energy inflation at the center, while Iran – Hormuz risk remained the main external variable.
💡 The USD held a relative advantage after the Fed meeting, supported by the “higher for longer” message, energy-price pressure and resilient US consumption data. DXY stayed around 98–99 without a major breakout, but still looked stronger than EUR and JPY in cautious sessions.
⚠️ EUR remained pressured as Europe is more exposed to an energy shock, while the ECB’s firm tone was not enough to lift the currency. GBP held up better as the BoE stayed relatively hawkish, though the broader market still favored range trading.
🔎 JPY was the key mover after USD/JPY approached the sensitive 160 area, forcing markets to reprice intervention risk. The yen rebounded sharply, but the move lacked durability as the BoJ stayed cautious and the US-Japan yield gap remained wide.
⏱️ Commodity currencies were more divided. CAD and NOK gained support from high oil prices, while AUD and NZD lagged due to risk sentiment and energy-import exposure. This pushed traders toward relative-value setups rather than a simple one-way USD trade.
✅ Going into the new week, focus stays on Iran – Hormuz, Brent crude and US labor data. If oil holds above 100 USD and US data does not weaken sharply, the USD should stay supported. Clear de-escalation, however, could quickly reduce safe-haven demand.