Week Ahead

Currency Overview (Premium Post)

USD

Near-term supported; hawkish skew dominant. Brent crude surging back above $100/bbl, up over 40% from pre-conflict levels, is the dominant driver, pushing US yields higher and reinforcing broad USD strength. The FOMC meeting on Wednesday is the week’s centrepiece. The Fed is widely expected to hold at 3.75%, but the decision may not be unanimous, Dallas Fed President Logan has explicitly stated she favours modestly higher rates. With Chair Warsh having abandoned explicit forward guidance, the post-meeting statement and press conference will be scrutinised for signals on a September hike. Soft core PCE (consensus +0.1% MoM) and Q2 GDP (+2.3% expected) on Thursday could temper hike expectations slightly. Overall skew: hawkish surprise more likely than dovish one.