• USD net spec G10 short up $3.7bn in Jun 4-10 IMM period; $IDX -0.13%

• Dollar lwr as recent data hints US economy slowing; Fed seen leaning dovish

• EUR$ +0.44% in period; specs +10.3k contracts now +93k; ECB cuts near end

• $JPY +0.79%, spec -6.6k contracts now +144.6k; yen longs cut on steady BoJ

• GBP$ -0.16%, specs +16.4k contracts now +51.6k; BoE steady in near-term

• $CAD -0.38%, specs +15.3k contracts now -93.1k; BoC near end of cut cycle

• AUD$ +0.9% in period, specs -6.8k contracts now -70k; Specs take profit near 2025 high

IMM Position Table:


Majors Chart:


(Paul.Spirgel is a Reuters market analyst. The views expressed are his own)

• NY opened near 0.6470 after 0.64565 traded overnight, choppy action early

• Buyers emerged however as safe-have assets traded softer during NY's morning

• Stocks bounced sharply off the lows, gold erased some gains

• AUD/JPY rally off low towards flat also helped underpin AUD/USD

• AUD/USD neared 0.6520 then neared 0.6505 late, traded down only -0.40%

• Pair's move above 10- & 21-DMAs, long lower wick on daily candle comforts longs
audusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Synopsis:

Danske expects the Bank of England to keep the Bank Rate unchanged at 4.25% at its June 19 meeting. With recent UK data, particularly labor market indicators, showing increasing signs of softening, Danske maintains its view for continued gradual easing in the coming quarters. Market impact on EUR/GBP is expected to be limited.

Key Points:

Policy Hold Expected:

• BoE is expected to keep rates unchanged at 4.25%, consistent with both market pricing and consensus expectations.

Softening Data Supports Cuts:

• Recent economic data has surprised to the downside.

• Labor market indicators show more pronounced cooling, reinforcing the case for further cuts later in the year.

Quarterly Easing Path Intact:

• Danske maintains its view for gradual, quarterly rate cuts beginning in the second half of 2025, supported by a weaker growth outlook and moderating inflation pressures.

Muted Market Reaction:

• EUR/GBP reaction is expected to be limited, as the decision and tone are broadly priced in.

• Danske remains negative on GBP due to the UK’s weaker macro outlook and relatively more dovish central bank trajectory.

Conclusion:

Danske sees no change from the BoE in June but expects a continued easing path as UK labor market conditions soften. While the upcoming decision is unlikely to move markets significantly, the underlying macro trend keeps Danske cautious on GBP going forward.

The EUR/USD could face further downward pressure as and firm U.S. economic indicators drive investors towards the safety of the dollar.

Recent geopolitical events, such as Israel's strike on Iran, have heightened tensions and bolstered demand for safe-haven assets like the dollar. If these , it could sustain bullish momentum for safe havens, potentially dragging the EUR/USD lower.

Additionally, shifts in options markets suggest that investors are increasingly hedging against a potential decline in EUR/USD. The notable decrease in the volatility premium for calls over puts since late May in both 1-month and 3-month risk reversals points to .

Furthermore, current positioning in the market might amplify downside risks. According to CFTC statistics, net-long euro positions are near seven-month highs; a failure of EUR/USD to maintain its broader uptrend could trigger a reduction in these long positions, exerting additional downward pressure on the currency.

U.S. economic data and yields could be problematic for longs. Labor markets are softening but aren't falling off a cliff. Inflation remains above the Fed's target and the June University of Michigan survey indicated consumer sentiment improved sharply.

Also, if U.S. yields and rates fail to soften, they could underpin the dollar.

EUR/USD bulls may have to rethink their views should dollar-positive influences intensify.
EURRR


CFTC


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Synopsis:

Goldman Sachs expects the Swiss National Bank (SNB) to deliver a 25bp rate cut next week, bringing the policy rate to 0%. Despite strong Q1 GDP, weak inflation and rising trade uncertainty justify easing. A larger 50bp move is unlikely, as the SNB remains cautious and data-dependent.

Key Points:

Expected 25bp Rate Cut:

• Goldman forecasts the SNB will lower its policy rate by 25bp to 0% at the June meeting.

• This would be a response to inflation falling below the SNB’s price stability range.

Subdued Inflation:

• Headline inflation was -0.1% y/y in May, undershooting SNB’s Q2 forecast.

• Goldman expects inflation to remain soft, supporting the case for easing.

Growth Outlook Softening:

• Q1 GDP was strong, but forward indicators have weakened due to rising global trade tensions.

• Slack in the economy has modestly increased, reducing the inflationary threat.

Cautious Forward Guidance:

• The SNB has stressed that policy decisions are not based on a single data point.

• A 50bp cut is possible but unlikely unless further trade or inflation shocks materialize.

Conclusion:

Goldman expects a 25bp rate cut from the SNB next week, reflecting soft inflation and rising external risks. However, the SNB is likely to remain measured, awaiting clearer signs of persistent weakness before considering a return to negative rates.

GBP/USD is likely to remain volatile and pressured in the near term due to escalating Middle East tensions and mixed economic signals from the UK and U.S.

The rising Middle East tensions sapped the pound, stirring a retreat from recent trend highs above 1.36 and a dip to session lows, underscoring sterling's sensitivity to global risk sentiment.

Though uncertainties about U.S. President Donald Trump’s trade policies had weighed on the dollar in recent months and created doubts about its safe-haven role, the events in Iran appear to have revived its status as a sought-after currency in troubled geopolitical times.

Meanwhile, fundamental factors such as relative interest rate expectations between the U.S. and UK remain aligned, suggesting that significant deviations from current GBP/USD levels might be limited.

Both economies are showing signs of slowing, which could prompt dovish stances from the Federal Reserve and Bank of England, potentially stabilizing the currency pair around its current levels.

Sterling is trading at the lower end of its recent range, with key support at the 21-DMA, currently at 1.3492, and resistance marked by Friday's fresh 2025 high at 1.3633. While sterling remains range-bound, technical indicators suggest that risks for a move higher remain, barring any escalation in geopolitical tensions.

However, should sterling close below 21-DMA support at 1.3492, it could shift momentum to bears, putting the May 29 low of 1.3417, and mid-May lows by 1.3150, into sharper focus.
GBP Chart:


(Paul Spirgel is a Reuters market analyst. The views expressed are his own)

Synopsis:

BofA's June FX and Rates Sentiment Survey reveals that while USD shorting remains the highest conviction trade of 2024, actual positioning still lags sentiment. Investors are wary of US fiscal risks and a fading "exceptionalism" narrative, yet resilient US data could challenge the bearish consensus.

Key Points:

USD Shorts Dominate—but Lag Sentiment:

• USD short remains the most crowded trade according to Exhibit 6.

• Despite strong conviction (Exhibit 7), actual positioning hasn't fully caught up to sentiment.

Unhedging US Exposure:

• Many respondents are reducing unhedged exposure to US assets (Exhibit 20), reflecting structural skepticism about the dollar’s long-term appeal.

Persistent Uncertainty:

• Trade uncertainty is expected to remain elevated (Exhibit 11), keeping downside pressure on the dollar.

• Expectations for waning US macro outperformance (Exhibit 10) further support a structurally bearish view.

Fiscal Risks Add to Pressure:

• Survey highlights growing investor concern over US fiscal sustainability (Exhibit 16).

• European fiscal outlook is modestly more hopeful (Exhibits 22, 23), which may reduce downside risks for EUR/USD.

USD's Lifeline—Data Resilience:

• Strong US economic data remains a potential offset to structural bearishness.

• If growth and inflation data continue to surprise to the upside, the dollar could defy negative positioning.

Conclusion:

BofA sees a disconnect between USD sentiment and positioning—investors are bearish, but not short enough. While fiscal and geopolitical risks weigh on the greenback, solid US data could still upset the consensus. The net effect is a market primed for volatility, with asymmetric risks for USD shorts if macro outperformance persists.

Synopsis:

Credit Agricole expects the Fed to keep rates unchanged at its June FOMC meeting but deliver a hawkish hold through upgraded inflation forecasts and a potentially shallower 2025 easing path. While concerns around Trump-era policies linger, a shift in the Fed’s forward guidance may support the USD by challenging prevailing dovish market views.

Key Points:

Policy Hold Likely:

• Fed is expected to maintain current rates next week and retain a balanced tone, acknowledging both persistent inflation and slowing growth.

• The core policy dilemma—sticky inflation vs. weakening momentum—has intensified since the March dot plot.

Hawkish Tilt in Projections:

• Credit Agricole expects:

  • A modest downgrade to near-term growth forecasts

  • An upward revision to inflation projections

• Despite weaker growth, higher inflation prints could push the median 2025 dot closer to a shallower easing cycle.

Shift in Market Expectations:

• If the dot plot confirms less aggressive rate cuts in 2025 and delays substantial easing to the outer years, the USD could benefit from a relative rates repricing.

• Markets may be forced to reassess overly dovish expectations, lifting USD sentiment.

Political Risk Still a Drag:

• Investor anxiety over Trump-era trade and fiscal risks continues to weigh on the dollar structurally, but short-term policy repricing could offer temporary relief.

Conclusion:

Credit Agricole sees the June FOMC as a tactical opportunity for the Fed to reassert its inflation-fighting credibility via a hawkish hold. A higher inflation trajectory and a shallower 2025 rate path could challenge dovish bets and improve USD appeal, even as longer-term political concerns persist.

June 13 (Reuters) - USD/CAD's June seasonal analysis suggests an underlying fragility that could see this market end lower in the days and weeks ahead.

USD/CAD's performance for each June since 2000 shows it has dropped in 15 of the last 25 years, or 60% of the time. While seasonality should not be considered in isolation, it is a useful tool when corroborated by other factors.

USD/CAD has dropped to an eight-month low as U.S. economic data supported expectations the Federal Reserve would renew its interest rate cutting campaign in the coming months. Weakness is likely to persist as spot continues to trade under the broken 1.3744 Fibo, a 76.4% retrace of the 1.3420 to 1.4792 (September to February) rise, a key level taken out in May.

Fourteen-week momentum remains negative, highlighting the scope for bigger losses. The risk is growing for an eventual probe of the September 2024 low of 1.3420 in the days and weeks ahead.
Seasonality Chart:


Weekly Chart:

(Martin Miller is a Reuters market analyst. The views expressed are his own)

• U.S.-listed shares of gold miners rise premarket, tracking higher bullion prices [GOL/]

• Gold prices soar, driven by safe-haven demand as geopolitical tensions escalated in the Middle East following Israel's widescale strikes on Iran

• Spot gold up 1.2% at $3,424.47/ounce, after hitting $3,444.06/ounce, its highest point since April 22

• Top miners Newmont up 1.7% and Barrick Mining

rises 1.2%

• South African miner AngloGold Ashanti rises ~1%

• Canadian miners Agnico Eagle Mines and Kinross Gold rise ~2% and 1.9%, respectively

(Reporting by Sumit Saha in Bengaluru)

• EUR/GBP pulls back after hold of 200-week MA (0.8541)

• The dip likely presents an opportunity for bulls to re-engage at 0.85

• Initial focus on rising geo-tensions, could underpin EUR/GBP

• Note that euro is a safer asset than sterling

• Given weekend gap risk, EUR/GBP may edge higher into Friday's close

• Technically, a close above the 200WMA would be encouraging for bulls

• COMMENT-Greater risk that the BoE shifts away from quarterly cuts
EURGBP weekly chart

(Justin McQueen is a Reuters market analyst. The views expressed are his own.)

• Geopolitical woes drive demand for FX Volatility and risk-off protection

• FX option implied volatility ramped higher in many currency pairs

• AUD/USD 1-month implied vol allegedly paid 9.4 and 10.4 Friday, from 8.9 Wed

• However, current 1-month levels well below early April spike highs at 16.75

• 1-month 25 delta risk reversals from long term low 0.3 to 1.0 AUD put v call

• Short dated options will benefit most from further volatility/spot losses

• 1-week expiry implied volatility 7.5 to 12.0 this week - includes US Fed Wed

• Related comment - FX traders can utilize options to hedge short USD bets
AUD/USD FXO implied volatility


AUD/USD 25 delta risk reversals

(Richard Pace is a Reuters market analyst. The views expressed are his own)

• USD/JPY remains vulnerable due to a number of factors

• Stocks tumble, oil soars as Israel's strike on Iran jolts mkts

• In times of uncertainty, funds usually flow into the safe-haven yen

• USD/JPY dropped to 142.80, in Asia, then subsequently rebounded to 143.88

• Note spot closed back below the cloud, currently spans 144.08-145.59 region

• 30, 60-day log correlations between USD/JPY, EUR/JPY high are high

Daily Chart:

(Martin Miller is a Reuters market analyst. The views expressed are his own)

• EUR/USD which reached 2025 high at 1.1632 Thursday dips after Israel strike

• Friday's 1.1512-1.1613 with pair last trading 1.1551

• Bets on a rise have probably grown from the $12 billion held week by June 3

• Conflict is cause to pare risk - easier choice as most bets are profitable

• Oil has surged which will undermine EUR/USD

• Rally is stretched at 1.1559 peak of the 20-day Bollinger Bands

• Good reason to exit FX positions traders determined to hold

•
EURUSD

(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• USD/JPY bouncing into Europe/London on Japanese importer buys, short-covers

• Seems many players saw today's plunge as a buying opportunity

• Given risk-off mood, heavy position adjustments into the weekend

• Also ahead of the multitude of central bank policy announcements next week

• USD/JPY from a spike low of 142.80 early Asia to 143.88 EBS

• Further moves higher may be difficult on $1.6 bln option expiries at 144.00

• Option expiries into Monday's 145.00 $7.4 bln look to continue to weigh

• Tech resistance from gradually ascending 200-HMA at 143.99

• Related comment , also , for more click on [FXBUZ]

USD/JPY hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• Off 0.5% at the base of a 1.3545-1.3632 range on the Israel/Iran conflict

• Risk off - Brent oil up 8.8%, E-mini S&P -1.55%, FTSE INDEX June -0.35%

• As more Middle East details emerge, or if Iran responds, expect volatility

• UK hiring slows again in May, but the downturn might be easing - recruiters

• Charts - 5, 10, & 21-day moving averages climb with neutral momentum studies

• 21-day Bollinger bands contract - the daily signals show a net positive bias

• Today's 1.3632 high then the 1.3749 2022 top are the next major resistances

• 1.3492 21 DMA and then 1.3417 May 29th base are the initial supports

• A close below the 1.3492 21 DMA would end the topside bias
Andy

(Andrew Spencer is a Reuters market analyst. The views expressed are his own.)

• AUD/USD -1.0% from Fri 0.6534 high after Israel attacks Iranian targets

• Israel strikes nuclear facilities, missile capabilities and commanders

• Broad risk-off reaction sweeps up AUD, next support 0.6445-50

• Pair pushing hourly lower Bollinger band, sell-off may run out of steam

• U.S. growth concerns remain; debt/tariff issues will still weigh on USD

• AUKUS review concerning for wider AU-U.S. trade relationship going forward

• Michigan consumer surveys due Fri, FOMC decision Wed next week

• Range early Asia 0.6464-0.6534, support 0.6445-50 0.6390, resistance 0.6550
AUD Hourly Bollinger Study

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD -0.8% on broad risk-off reaction to Israel reportedly striking Iran

• Pair pushing hourly lower Bollinger band, likely oversold short-term

• Thur 0.64775 low will provide initial support, U.S. growth concerns remain

• AUKUS review concerning for wider AU-U.S. trade relationship going forward

• U.S. civil unrest, debt & tariff concerns will continue to weigh on USD

• Michigan consumer surveys due Fri, FOMC decision Wed next week

• Range early Asia 0.64855-0.6534, support 0.6475 0.6390, resistance 0.6550
AUD Hourly Bollinger Study

(James Connell is a Reuters market analyst. The views expressed are his own.)

• -0.15% after closing up 0.55% at the 2025 high, with the USD off 0.73%

• Israel strikes Iran, Axios reports - USD climbed 0.2% initially

• UK hiring slows again in May - downturn might be easing, recruiters say

• UK Plc's stability and bargains appeal to dealmakers amid global uncertainty

• Charts - 5, 10, & 21-day moving averages climb with momentum studies

• 21-day Bollinger bands rise - the daily signals show a positive bias

• The 1.3749 2022 high is the next significant resistance level

• 1.3496 21 DMA and then 1.3417 May 29th base are the initial supports

• A close below the 1.3496 21 DMA would end the topside bias
Andy

(Andrew Spencer is a Reuters market analyst. The views expressed are his own.)

• +0.05% after closing up 0.85% to a fresh 2025 trend high with the USD -0.73%

• Economists predict Germany to return to growth after 2 years of contraction

• ECB's Schnabel, a hawk, said ECB monetary policy is in a 'good place' now

• Charts - daily momentum studies, 5, 10 & 21-day moving averages rise

• 21-day Bollinger bands head higher - daily charts retain a topside bias

• Yesterday's 1.1486 low then last Friday's 1.1372 base are initial supports

• The 1.1632 2025 high yesterday, then 1.1692 Oct 2021 high first resistance

• 1.1581 upper 21-day Bolli band suggests the euro is overbought short-term

• 1.1550 592 mln and 1.1600 581 mlnc lose Jun 13 strikes
Andy

(Andrew Spencer is a Reuters market analyst. The views expressed are his own.)

• AUD/USD +0.8% from Thur 0.64775 low on mounting U.S. growth concerns

• U.S. continuing jobless claims 1.956 mln, highest level since Nov 2021

• Benign PPI data sent UST yields & USD lower, piles pressure on Fed

• DXY hit fresh 97.604 2025 low; AUD set for attempt at 0.6550 resistance zone

• AUKUS review concerning for wider AU-U.S. trade relationship going forward

• U.S. civil unrest, debt & tariff concerns will continue to weigh on USD

• Michigan consumer surveys due Fri, FOMC decision Wed next week

• Overnight range 0.64775-0.6534, support 0.6475 0.6390, resistance 0.6550
AUD Daily 200-DMA & DXY Daily

(James Connell is a Reuters market analyst. The views expressed are his own.)

Synopsis:

Nomura expects no change in the Bank of Japan’s policy rate at the June 16–17 monetary policy meeting. While the BoJ continues to evaluate reducing JGB purchases, any changes are likely to be modest and postponed until April 2026. Governor Ueda is expected to maintain a cautious tone, avoiding firm guidance given trade policy uncertainties and limited inflation clarity.

Key Points:

No Rate Change Expected:

• BoJ is widely expected to keep its policy rate unchanged next week.

• Rate policy and JGB purchase reductions serve distinct goals and should be viewed independently.

JGB Purchase Strategy:

• BoJ is reportedly considering slower JGB purchase reductions from April 2026.

• Reluctance remains to consolidate maturity brackets, especially in the super-long segment, in order to preserve market-driven rate formation.

Governor Ueda’s Press Conference:

• Unlikely to provide new economic or inflation insights given limited data on tariff impacts.

• A shift in tone may only occur if the US–Japan summit at the G7 yields a surprise trade breakthrough.

Communication Caution:

• BoJ’s communication strategy remains conservative, especially in light of ongoing global policy uncertainty.

• Expect continuity in policy guidance barring external shocks or new data.

Conclusion:

Nomura anticipates a hold from the BoJ in June, with no rate change and a cautious approach to asset purchase reductions. While the pace of JGB tapering may slow from 2026, the central bank is unlikely to alter its core messaging or operational structure in the near term, especially ahead of key global trade developments.

• GBP$ holds 0.4% gain to 1.3591 in NY afternoon, Thurs range 1.3623-1.3525

• Pair surged to 2025 high at 1.3623 after US PPI, jobless claims hint at softer US growth view

• Sterling testing 2025 highs after on-target PPI, rising jobless claims nL6N3SF0MP

• UST long-end yields dip 5-7bp; LSEG's IRPR sees deeper Fed cuts by Dec 2025 FOMC

• Market focus shifts to US retails sales Jun 17, UK CPI/RPI Jun 18

• GBP$ res 1.3623 Thursday's 2025 high, 1.3659 rising upper 30-d Bolli, 1.3749 Jan 10 2022 wkly high

GBP$ Chart:


(Paul.Spirgel is a Reuters market analyst. The views expressed are his own)

Synopsis:

Credit Agricole identifies three key pressures undermining the US dollar: dovish Fed rate expectations, renewed debate over the USD’s reserve status, and escalating trade tensions ahead of the July tariff deadline. While structural USD dominance remains intact, near-term sentiment is fragile.

Key Points:

1. Fed Rate Cut Expectations Rise:

• A second soft inflation print has led markets to fully price in two 25bp cuts by year-end.

• Credit Agricole’s economists caution that tariffs have yet to fully feed into CPI as firms deplete pre-Liberation Day inventories.

• The Fed is still expected to hold steady next week, favoring a wait-and-see stance.

2. EUR Reserve Currency Momentum – Still Premature:

• The ECB’s recent report acknowledged rising EUR internationalization.

• However, structural hurdles—lack of full banking, savings, and investment union—limit the euro’s near-term challenge to USD dominance.

• Credit Agricole sees no imminent threat to the USD’s reserve currency role.

3. Trade War Risks Resurface:

• President Trump has signaled he will issue letters on foreign tariff levels, reviving fears of renewed trade escalation.

• With the 9 July deadline for the reciprocal tariff pause approaching, market confidence that trade tensions have peaked is faltering.

Conclusion:

The USD faces near-term pressure from dovish rate expectations, fragile reserve currency sentiment, and resurgent trade risks. While Credit Agricole remains skeptical of structural de-dollarization, the current environment presents tactical headwinds for the greenback, particularly as the July tariff deadline looms.