June 11, 2025 – Written by Frank Davies

STORY LINK GBP/USD Forecast: Dollar Dips after Inflation Data, 30-Year Bond Auction Next

The US Dollar dipped sharply following the weaker-than-expected US inflation data.

The Pound to Dollar exchange rate (GBP/USD) jumped to 1.3550 before a retreat to 1.3525.

Key resistance remains towards 1.3600 with doubts whether the Pound can secure sufficient momentum. According to UoB GBP/USD is vulnerable to a slide to 1.3430 unless there is a break above 1.3580.

A sustained move above 1.3600, however, would trigger speculation over more gains.

Markets moved to price in a larger potential for a September Fed rate cut and there will be expectations of another barrage of Fed criticism from President Trump.

Traders are already sensitive over the risk of a pro-administration appointment for the next Fed Chair.

There was limited reaction to the UK spending review. The substantial front-loading of spending in this parliament was confirmed with health and defence spending securing strong gains, while other departments will suffer.

The current market dynamics were illustrated by the fact that US inflation data had a much bigger impact on UK yields with the 10-year yield sliding to near 4.55% from above 4.60%.

According to ING; “The take-away for markets today will simply be confirmation that there is very little fiscal headroom.”

Overnight, it was reported that the US and Chinese negotiators have produced a framework for implementing the details of an agreement that had been previously agreed in May

Trump stated that a final deal had been reached with tariffs on Chinese imports at 55% and Chinese tariffs on US imports at 10%, although there was still confusion over the figures.

Commonwealth Bank of Australia Currency Strategist Carol Kong commented; “It will still be very hard and it will take a long time for both sides to reach a comprehensive trade agreement. That sort of comprehensive deal usually takes years to be reached, so I’m skeptical that a framework reached at the meeting in London will be comprehensive. Tensions might be de-escalated for now, but they will certainly escalate again in coming months.”

Markets are likely to be disappointed that tariffs on Chinese imports will be 55% despite limited immediate reaction.

US consumer prices increased 0.1% for May compared with consensus forecasts of 0.2% with the year-on-year increase at 2.4% from 2.3% and slightly below expectations of 2.5%.

Core prices increased 0.1% on the month compared with expectations of 0.3% with the annual increase held at 2.8%.

Markets still expect no Fed rate cut in June and July, but with increased expectations of a September cut.

Scotiabank the release of the US Federal Budget Balance will likely sharpen the market’s focus on the USD’s longer-term issues.

According to ING; “A soft 3-year Treasury auction reversed some recent gains in US government bonds, which now face a dual test today with the highly watched 10-year auction.”

MUFG added; “The results were weak enough to keep the markets nervous ahead of the USD 39bn worth of 10-year paper auctioned this evening and USD 22bn worth of 30-year tomorrow. Nervousness around the 30-year auction could be particularly high given the signs of investors steering clear of longer-dated paper due to both inflation and debt sustainability concerns.”

MUFG also noted suggestions that the Budget Bill would be amended in the Senate.

It added; “Some element of sense prevailing in the Senate in pushing back on this bill would certainly help reduce some of the current negative US dollar sentiment.”

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TAGS: Pound Dollar Forecasts

June 11, 2025 – Written by David Woodsmith

STORY LINK Euro to US Dollar Forecast: EUR Targets 1.15 as USD Bears Wait

Overall market volatility has eased with tighter ranges, but markets remain very wary that underlying tensions could quickly flare up and trigger a fresh round of turbulence.

Trade negotiations will continue while there is another important US Treasury bond auction later in the day following the latest inflation data.

Markets are also continuing to monitor political developments including the US Administration’s reaction to the Los Angeles protests and potential threats to Federal Reserve independence.

According to IG Index; “now people are just trying to work out whether they’re going to buy or sell the U.S. dollar and that’s I think reflecting a bit of that indecision.”

UoB commented; “EUR/USD appears to have entered a range trading phase, likely between 1.1330 and 1.1495.

According to ING; EUR/USD’s direction today will be mostly set by the dollar, with some support likely near 1.1400 and a possible push above 1.1500 by the week’s end.”

Overnight, there were reports that negotiators have agreed on a “framework” to restart the flow of sensitive goods, including rare earths, pending approval from President Trump and Chinese President Xi.

MUFG commented; “There was no plan for the leaders to talk and nothing on a new round of negotiations beyond discussions over the coming days to ensure the details of this agreement are implemented.”

According to ING; “From a market sentiment standpoint, this feels like a positive step toward de-escalation, but not a major breakthrough. China’s refusal to commit to reducing its trade deficit still leaves plenty of ammo for trade hawks in Washington to resist any structural easing.”

Elsewhere on the trade front, the US Court of Appeals for the Federal Circuit stated that it would extend the stay on reciprocal tariffs until the case is heard on 31st July.

The current 90-day delay is due to end on July 9th and there is, therefore, the possibility that aggressive tariffs will be put in place, especially against the EU.

MUFG commented; “the Trump administration would have resulted in an appeal to the Supreme Court and hence the timing of the full final outcome to this question of legality was always likely to go beyond July-August.”

Elsewhere, there has been speculation that current Treasury Secretary Bessent is being considered as a potential candidate to be the next Federal Reserve Chair.

There will be concerns that Bessent would be too close to the Administration.

ING commented; “The dollar strongly dislikes any threats to Fed independence. Add in that Bessent is likely to favour much lower rates (echoing Trump’s rhetoric), and the greenback faces mostly downside risks from this story.”

The US will also release the latest consumer prices data on Wednesday with expectations that the headline rate will increase to 2.5% from 2.3%. Core prices are expected to increase 0.3% on the month with a 2.9% annual rate from 2.8%.

ING expects a slightly softer set of data which would tend to reinforce speculation over an earlier cut in interest rates and undermine the dollar.

Danske Bank sees the potential for dollar gains in the near term, especially if there is an easing of trade tensions.

Nevertheless, it added; “we continue to see USD strength as an opportunity to fade, given ongoing medium- to longer-term macro and policy headwinds. These are likely to sustain the negative risk premium embedded in the USD post-Liberation Day. We maintain a 12M EUR/USD target of 1.20.”

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TAGS: Euro Dollar Forecasts

• On Wednesday, we’ve seen the British pound fall apart during early trading, only to turn around and show signs of life again.
• At this point in time, the market looks as if it is going to try to form a bit of a hammer for the Tuesday session, and that of course would be a strong sign.
• That being said, we also get the CPI numbers coming out of the United States on Wednesday, which of course is potentially going to be important for where the US dollar goes next. Obviously, that will have a knock on here British pound more for it, depending on what the dollar is doing.

Technical Analysis

The technical analysis for the British pound obviously is bullish over the longer term, but we have a massive amount of resistance just above that is starting to cause several issues. The 1.3650 level is an area that’s been important multiple times, but quite frankly we can even break above the 1.36 level. Underneath current trading, we have the 1.34 level offering support. If we could break down there, the market could open up the possibility of a move down to the 1.33 level, where we find the 50 Day EMA, which is rising at the moment. Below there, we have the 1.32 level, which is the next major support level.

Ultimately, I think we are more likely than not to see a lot of sideways and choppy action, but ultimately, we will need some type of catalyst to get bigger move going. I think the CPI numbers could possibly be that, but be honest, we seem a little bit “stuck” at the moment, which this time of year can be somewhat difficult to deal with via a lack of involvement in the market as summertime can be quiet. In the short term, I think we are looking at this prism of the 150 pips range for short-term range bound traders.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

• The USD/JPY forecast shows an increasing likelihood that the BoJ will delay rate hikes to next year.

• Talks between China and the US ended, easing trade war fears.

• Traders are paying close attention to the upcoming US CPI report.

The USD/JPY forecast shows an increasing likelihood that the Bank of Japan will delay rate hikes to next year. Meanwhile, talks between the US and China ended with few details. At the same time, market participants are awaiting the US CPI report for clues on the future of Fed rate cuts. 

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A Reuters poll on Wednesday revealed that a slim majority of economists believe the BoJ will hike in Q1. According to them, the impacts of Trump’s tariffs will force policymakers to delay hikes. Meanwhile, top officials at the bank have reiterated that they will continue to hike rates when inflation and growth re-accelerate. 

Elsewhere, talks between China and the US ended, easing trade war fears. However, there were few details on the outcome of the talks. Still, just the fact that they met and discussed trade was enough to show progress in negotiations. 

Meanwhile, traders are paying close attention to the upcoming US CPI report. The data might show a 0.2% increase in price pressures in May. Meanwhile, the annual figure might increase from the previous 2.3% to 2.5%. If inflation is hot, it will confirm fears that Trump’s tariffs have hiked price pressures. Such an outcome would mean more delays on Fed rate cuts.

USD/JPY key events today

• US core CPI m/m
• US CPI m/m
• US CPI y/y

USD/JPY technical forecast: Broken trendline yells for more gains

On the technical side, the USD/JPY price has broken above a solid resistance trendline, a sign that bulls might be ready to take charge. The price trades above the 30-SMA, with the RSI over 50, showing bulls are in the lead. However, they are facing a solid hurdle at the 145.00 key level. 

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For some time, the price has been making lower highs. However, it has failed to make lower lows as the 142.55 held firm as support. If bears cannot make lower lows, bulls will likely get stronger and start making higher highs and lows. 

A break above the 145.00 key resistance level will clear the path for USD/JPY to retest the 147.00 key level. On the other hand, if the level holds firm, the price will likely drop back below the trendline to retest the 142.55 support. 

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EUR/USD Analysis Summary Today

• Overall Trend: Bullish
• Today’s EUR/USD Support Levels: 1.1370 – 1.1300 – 1.1220
• Today’s EUR/USD Resistance Levels: 1.1470 – 1.1520 – 1.1600

EUR/USD Trading Signals:

• Buy EUR/USD from the support level of 1.1340 with a target of 1.1420 and a stop-loss at 1.1300.
• Sell EUR/USD from the resistance level of 1.1480 with a target of 1.1200 and a stop-loss at 1.1540.

EUR/USD Technical Analysis Today:

As anticipated, the EUR/USD pair remains within its current range, showing bullish momentum as markets and investors await the release of US inflation figures later today. These figures, due at 3:30 PM Egypt time, will significantly impact market expectations for the future monetary policies of the US Federal Reserve. Yesterday, the EUR/USD price jumped to the 1.1447 resistance level, close to its three-year high of 1.1572 recorded in April, as traders closely monitored developments in ongoing US-China trade talks.

Trading Advice:

We still recommend selling the EUR/USD on any upward bounce and avoiding risk, regardless of the strength of the trading opportunities.

Meanwhile, investors are assessing comments from European Central Bank (ECB) officials for clues on the bank’s next policy moves. Governing Council member François Villeroy de Galhau indicated that the ECB can still act quickly to adjust interest rates, even after its eighth consecutive cut, which he stated “returned to normal” in monetary policy. Last week, the ECB cut interest rates as expected, but Governor Christine Lagarde suggested that the monetary easing cycle might be nearing its end. The deposit facility rate is now 2%, while Eurozone inflation fell to 1.9% in May 2025. Concurrently, the bloc’s economy grew by 0.6% in the first quarter of 2025, its fastest growth rate since Q3 2022.

Technical Outlook for EUR/USD Today:

Based on the daily timeframe chart, the EUR/USD currency pair remains on a bullish trajectory, supported by the stability of currency bulls around and above the 1.1400 resistance. This stability is pushing the 14-day RSI (Relative Strength Index) near the 60 reading, which reinforces bull dominance and anticipates stronger gains before the indicator reaches overbought territory. Simultaneously, the MACD (Moving Average Convergence Divergence) indicator confirms the upward path. The bulls’ next key targets are the resistance levels of 1.1520 and 1.1600, with signs of overbought conditions likely to begin around the latter level. Conversely, over the same period, the support levels of 1.1220 and 1.1165 remain crucial for bears to break the current bullish trend of the currency pair.

Goldman Sachs Raises EUR/USD Price Forecast

Goldman Sachs has raised its forecasts for the EUR/USD pair, citing relatively weaker equity performance for Euro-based investors, declining foreign appetite for US assets, and a confirmed slowdown in US economic activity. On another note, according to performance across stock trading platforms, US equities may appear stable in USD value, but they have fallen by 8% year-to-date for Euro investors, making EU stocks relatively more attractive. Overall, the less appealing US investment climate is prompting global investors to diversify their investments away from the US dollar and USD-denominated assets.

Recently, recent macroeconomic indicators support the narrative of slowing US economic activity, reinforcing the argument for continued USD depreciation.

Consequently, Goldman Sachs has raised its EUR/USD targets to:1.17 over 3 months

1.20 over 6 months
1.25 over 12 months

These targets are higher than the previous 1.12, 1.15, and 1.20 set after the “Liberation Day” policy announcement. In general, Goldman Sachs maintains its structurally bearish outlook on the US dollar, driven by macroeconomic divergence and global capital reallocation. From their perspective, the EUR/USD trend remains bullish, with 1.25 now being the 12-month target.

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• The GBP/USD price analysis suggests increasing expectations for Bank of England rate cuts.

• The UK labor market was weaker in the three months to April.

• Market participants are awaiting the US consumer inflation report.

The GBP/USD price analysis suggests increasing expectations for Bank of England rate cuts this year after downbeat UK employment data. Meanwhile, market participants remain cautious ahead of crucial US inflation figures. 

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Data on Tuesday revealed that the UK labor market was weaker in the three months to April. The unemployment rate reached an almost four-year high, rising from 4.5% to 4.6%. At the same time, wage growth slowed sharply from 5.5% to 5.2%. 

The downbeat figures increased BoE rate cut expectations and weighed on the pound. Before the report, traders were 39-bps of rate cuts this year. This figure increased to 48-bps after the data. 

Meanwhile, market participants are awaiting the US consumer inflation report, scheduled for release on Wednesday. According to estimates, inflation increased by 0.2% in May. Meanwhile, the annual figure increased by 2.5%, above the previous reading of 2.3%. 

A hotter-than-expected reading would confirm the Fed’s fears that Trump’s tariffs have increased price pressure. Moreover, it would lower Fed rate cut expectations, boosting the dollar. On the other hand, if inflation is softer, it will weigh on the dollar by increasing bets for a Fed rate cut.

GBP/USD key events today

• US core CPI m/m
• US CPI m/m
• US CPI y/y

GBP/USD technical price analysis: Bears find their feet below the 30-SMA

On the technical side, the pound is finding its feet below the 30-SMA after a recent shift in sentiment. Meanwhile, the RSI trades nearer the oversold region, indicating solid bearish momentum. However, after a strong break below the SMA, momentum has eased, and price action shows hesitation to continue lower. The price is now making small-bodied candles. 

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Nevertheless, the bearish bias has strengthened, and the path is clear for GBP/USD to reach the 1.3400 support level. A break below this level will strengthen the bearish bias and allow the price to target the 1.3200 support. 

However, if the level holds firm, bulls might return for a pullback. However, the bearish bias will remain strong as long as the price stays below the 30-SMA.

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