Daily Forex News By XtreamForex

GBP/USD Rises Once More as Dollar Expectations of a Rate Cut

GBP/USD climbed higher this week, hitting above 1.3250 on Thursday—marking six days straight of upward moves. What’s driving it? Well, the dollar’s getting weaker because more traders now expect a rate cut from the Fed come December. Despite the recent mixed bag of US economic data, most people continue to hold a more dovish view, which keeps the dollar on its back foot.

Take a look at the CME Fed Watch Tool—markets now give an 84% chance the Fed will cut rates by 25 basis points, way up from last week. Not even stronger US Durable Goods Orders or fewer Initial Jobless Claims could shake this outlook. Investors seem pretty convinced that easing inflation and political pressure will push the Fed to loosen policy soon.

Dollar Drops Even as Data Beats Expectations

Recent US numbers showed Initial Jobless Claims dropping to 216,000, beating forecasts and pointing to a solid labor market. Normally, you’d expect that to help the Dollar, but right now everyone’s focused on what the Fed does next. There’s also talk that the White House is eyeing new Fed chair candidates who favor lower rates, which just adds to the Dollar’s struggles.

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EUR/JPY Pair Nears 180.70; Market Banks on Eurozone HICP Data

EUR/JPY rises near 180.70 as traders snap up the pair after three straight days of losses. Buyers stepped in once the price bounced off the 180.00 level, and now everyone’s watching for the latest Eurozone inflation numbers (HICP) to set the tone.

The Expectation is that the ECB Will Keep Rates Steady 

Right now, the Euro’s got some support. People expect the ECB to keep rates steady for a while, especially with the flash HICP release just around the corner. Forecasts put headline inflation at 2.1% year-on-year for November and core inflation at 2.5%. Recent numbers out of France, Spain, and Italy didn’t show much price pressure, but Germany’s data came in a bit hotter than expected. All this mixed data adds up to one thing: the ECB probably won’t cut rates anytime soon. That’s giving the Euro some momentum and keeping EUR/JPY on firmer ground.

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GBP/USD Drops Below 1.3350 as the USD Accelerates

Early on Thursday, GBP/USD is trading around 1.3330, retreating from its recent two-month high. The main story? The US Dollar bounced back, even though American economic data has been underwhelming. People are keeping an eye on the calendar—big US numbers are on the way, especially the Weekly Initial Jobless Claims Report. Right now, there’s caution in the air, but with everyone talking about a possible Fed rate cut next week, the Pound isn’t falling too far.

Fed Rate Cut Hopes and the Kevin Hassett Factor

Soft US numbers, like the latest Manufacturing PMI and ADP jobs data, have traders doubling down on a December Fed rate cut. FedWatch odds are now near 90% for a 25-basis-point cut, and markets expect more easing in 2025. That takes some pressure off the Dollar, which gives GBP/USD a bit of breathing room for now.

But there’s another angle: possible changes at the Fed. Trump says he’ll announce his pick for the next Fed Chair early next year, and Kevin Hassett—known for pushing aggressive rate cuts—is in the running. If Hassett gets the job, expect a more dovish Fed, and that could pull the Dollar down over time.

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AUD/JPY Weakens Following RBA’s Decision to Maintain Rates Above 3.6%

AUD/JPY in the early Asian hours on Tuesday floated near 103.20 levels, after the Reserve Bank of Australia (RBA) kept its Official Cash Rate at 3.6%. The cut had been widely anticipated by markets; however, the more dovish tone from officials helped keep mild pressure on the Aussie, dragging it through 103.50.

RBA Cautious on Inflation Outlook

In its statement, the Australian central bank indicated that recent inflation pressures may also partially stem from temporary factors, though broadening price growth still needs to be closely watched. And policymakers said they will remain cautious and monitor the economic outlook as new data is released. The decision reinforced perceptions that the RBA is set to stay on the sidelines for now, keeping a lid on AUD gains across the board.

Worries Over Earthquakes May Affect BoJ Outlook

In the meantime, investors are also keeping an eye on Japan after Learning of a powerful earthquake. Analysts said that, depending on the extent of the damage the world’s third-largest economy sustained, the Bank of Japan (BoJ) could postpone a widely expected rate hike next week. The bank’s forthcoming meeting, on December 18–19, is now the subject of extra uncertainty, which could in turn weigh on the Yen in the sessions ahead.

Also in the market spotlight will be any comments from BoJ Governor Kazuo Ueda later in the day, which may provide clues on whether plans for policy normalization will proceed or be put on hold until further notice. AUD/JPY is under mild selling pressure for now; geopolitical and central bank expectations are expected to influence short-term movements.  For now, the Aussie dollar remains in demand as the Yen takes lower ground on risk sentiment.

EUR/USD Keeps The Lower Bound Of Range Post-Fed Cut, Market Awaits Jobless Claims

The EUR/USD was trading around 1.1690 in the early European session on Thursday, touching lower with no clear direction. In the aftermath of the Federal Reserve’s latest rate cut, the market’s reaction was muted — more a polite nod than an emphatic leap. And market veterans often refer to such pauses as the market “taking stock”, in a neutral, battery-recharging mode rather than necessarily signalling a new trend.

Not Just the Cut, Powell’s Tone Sets Expectations

The Fed lowered its benchmark rate to a range of 3.50%–3.75%, though the focus was on Chair Jerome Powell’s cautious words. Officials signalled openness to waiting and reassessment, and that tone seems to matter more for traders than the 0.25-point move itself. That new recalibration was apparent in price action: Fed policy tools are now showing a higher probability that the next interest rate move will be a hold. In other words, the market responded to nuance — to the hint that the cut was not the start of a series of them — rather than to the cut itself.

CB’s Calm Keeps a Floor Under the Euro

The ECB in Europe remains a picture of stability. “Appropriate” has been the word from President Christine Lagarde and other policymakers so far, and those sorts of steady terms offer little support for the Euro. The cross (cross-currency pair) may hold back until it receives a clearer signal, with US Initial Jobless Claims as the next spark. The dollar would be likely to catch a bid if claims are below 1.3 million, while  EUR/USD is expected to attempt a break higher toward the key 1.1700 level.

USD/CAD today, during the Asian session, is trading flat at around 1.3770. This steady movement indicates that traders are awaiting an important update from the United States. Attention now turns to the NFP (Nonfarm Payrolls) –  because it reflects labour market statistics for both October and November. Traders have been looking to stay alert and cautious until that report is released, and, henceforth, we’ve seen range-bound conditions in the pair.

Why the U.S. Jobs Numbers Matter

 The US NFP report provides a glimpse of how well or how poorly the job market is in the US. This information is worth tracking, as it could sway the future direction of US Federal Reserve interest rate policy. The Fed has already reduced interest rates by 75 basis points this year, primarily in response to signs of a slowing job market. As per predictions, the Unemployment Rate of the USA remained steady at 4.4% during November. The data isn’t providing a positive bias for the greenback, say more losses ahead.

Traders are also waiting for the US Retail Sales and business activity figures to be released along with NFP. Retail Sales should tick up 0.2%, which would point to unchanged consumer spending.

Canadian Dollar Remains Stable

 Meanwhile, the Canadian Dollar, on the other hand,, is doing little in response to the latest inflation numbers. Canada’s Consumer Price Index increased by 2.2% on an annual basis, missing expectations slightly. The so-called core inflation, which excludes volatile items, was 2.9%. The Bank of Canada has said that inflation is near its 2 per cent target and is expected to continue to be well-behaved.

All in all, USD/CAD is trading within a well-defined range while markets wait for fresh clues from US data.

EUR/USD Keeps Above 1.1800 As It Retraces From Three-Month Peak

EUR/USD remains in a holding pattern—likely to continue. For the most part, the EUR/USD has wasted the recovery effort since bottoming at 1.1168 (three-month low) by inching closer to 1.1808 last week but so far failing short of reaching that high again for a second day. But narrow that gap, buyers have not let off the hook yet as price is still trading higher for a third straight day.

On the daily chart, the uptrend is intact. An upward movement is usually open when price action remains with an ascending channel. Momentum seems a little hot, though. The 14-day RSI at 71 is deep into overbought territory. That doesn’t scream “reversal,” but it does indicate the market might struggle a bit or drift sideways for some time before resuming off to the races.

When things run up this quickly, traders get a little jumpy. So, it wouldn’t shock anyone to see some sideways action or consolidation right around these levels.

Technical Structure Continues to Favor Buyers
From a technical standpoint, the bias stays bullish. The nine-day EMA has crossed above the 50-day EMA, and the price has remained above both. That shows buyers are still driving the trend, and demand isn’t drying up.

Traders Watching Support and Resistance: Important Levels Coming Up

The important level to keep an eye on is 1.1800. The pair may attract new buyers and move towards the top of the channel at 1.1880. The next real target for EUR/USD is 1.1918, a level we haven’t seen since the middle of 2021, if it can successfully break past 1.1808.

If the pair slips, first support comes in at the nine-day EMA near 1.1745, which lines up with the bottom of the channel. A break there could take some wind out of the bulls’ sails and put 1.1660 in play, with stronger support waiting near 1.1589.

The Australian Dollar Near a 14-month High as the RBA Maintains Its Hawkish Tone

The Australian Dollar kept its gains and momentum against the U.S. Dollar on Monday, hitting a 14-month high at 0.6727. Following the release of the Reserve Bank of Australia’s minutes from its December meeting, this rally began. The message was very clear: if inflation doesn’t decline, the RBA is prepared to raise rates once more because they don’t think the current rates are doing enough to control it.

Inflation is still running hot in Australia. In October 2025, headline inflation bumped up to 3.8%, a jump from 3.6% the month before and still above the RBA’s 2–3% comfort zone. That’s got analysts betting on another rate hike as soon as February 2026, with big banks like Commonwealth Bank of Australia and NAB calling for rates to rise to 3.85%. Meanwhile, consumer inflation expectations are climbing, too—hitting 4.7% in December. That only adds fuel to the RBA’s hawkish fire.

China News and Regional Tensions Grab Attention

On top of that, the Australian Dollar is getting a boost from headlines out of China. Australia’s economic fortunes are tightly linked to Chinese trade, so whenever Beijing signals more investment—like this week’s news about a push for advanced manufacturing and innovation—it gives the AUD extra momentum. But it’s not all smooth sailing. Tensions in the South China Sea have certainly escalated since China began its military drills, dubbed ‘Justice Mission 2025,’ off the coast of Taiwan. Actions like these underline Asia’s shipping and trade routes, and may lead to currency swings globally.

US Dollar Waits for Fed Clarity

Shifting focus to US data, Dollar Index is holding steady near 98.10. Traders are in a holding pattern as they wait for the Federal Reserve’s December meeting minutes to get a sense of what policy will be like through 2026. The Fed lowered rates by 25 basis points just last month, and the market is still pricing in two more cuts next year.

Not quite yet, if the most recent U.S. data are any guide. With GDP growth of 4.3% in the Q3, well ahead of expectations, and the number of unemployed people falling to 214k, it’s a strong labour market. But the Fed is expected to keep its foot on the brake for now because of both weaker inflation and sluggish hiring.

AUD/USD is holding above the nine-day EMA and trading just beyond 0.6720 at present. For now, that keeps the bulls in control. The duo could escalate towards 0.6830 on rising beyond 0.6727, though a downside below 0.6680 may indicate a short-term drop.