Latest Global Foreign Exchange News

Release time：2026-07-27 Publisher：GINZO

Risk Disclaimer: The following news is compiled purely for market information and does not constitute any investment advice. Foreign exchange trading carries high risks; please trade prudently.

I. Core Macro Theme: Super Central Bank Week Arrives amid Volatile Geopolitics in the Middle East

The foreign exchange market enters a critical super central bank week. Two major focal points are the Federal Reserve’s policy meeting on July 28–29 and the Bank of Japan’s rate decision on July 31. Combined with sharp swings in the Middle East and drastic oil price fluctuations, expectations for global inflation and central bank rate hikes keep shifting, forming the dominant variable steering the short-term trend of the US Dollar and non-US currencies.

Latest Developments in the Middle East

US-Iran tensions escalated in the first half of the week. Shipping in the Strait of Hormuz and the Red Sea came under simultaneous threats, and Brent crude once neared USD 100 per barrel. Over the weekend, the US suspended airstrike plans while Iran sent conciliatory signals. Market risk aversion cooled rapidly, triggering a notable drop in oil prices.

A new trading narrative has taken shape:

Rising oil prices → higher imported inflation → expectations mount that major central banks will maintain high interest rates or deliver further hikes → supportive for the US Dollar.

By contrast, de-escalation and falling oil prices will ease hike expectations and pressure the US Dollar.

The impact on the Japanese Yen is distinctive. As a nation heavily reliant on energy imports, Japan faces widening trade deficits and intensified imported inflation amid surging oil costs. The Yen’s traditional safe-haven status weakens, and escalating tensions tend to weigh on the currency.

Market Pricing for Federal Reserve Policy

The benchmark interest rate remains within the 3.50%–3.75% range. According to the CME FedWatch Tool:

Probability of rates being kept unchanged in July: 63.7%; probability of a 25bp hike: 36.3%.
The market’s mainstream bet targets a rate hike starting in September, with a 55.2% chance of a cumulative 25bp increase and a 25.2% chance of two hikes.

Fed Chair Wash maintains the strategy of abandoning fixed forward guidance, adopting data-dependent decisions at each meeting, leading to markedly elevated policy uncertainty. Institutions generally hold the view: hawkish rhetoric and upwardly revised inflation forecasts at this meeting will boost the US Dollar Index again; cautious wording will create room for a near-term pullback in the US Dollar.

US June CPI rose 3.5% year-on-year, with core CPI up 2.6% year-on-year. Inflation data softened somewhat, yet rebounding energy prices prevent markets from confidently betting on sustained disinflation.

II. In-Depth Analysis of Major Currencies

1. US Dollar Index (DXY)

Current trading range: 101.10–101.60.

Supportive factors: Geopolitical safe-haven demand, inflation risks driven by rebounding oil prices, lingering odds of a Fed rate hike within the year, and persistently high US Treasury yields.

Bearish factors: Tentative de-escalation in the Middle East, marginal cooling of US inflation, and market pricing of adverse economic impacts from prolonged high interest rates.

Near-term performance hinges heavily on the outcome of the Fed meeting. A hawkish decision would lift resistance at 102.00; dovish signals would test support at 100.80.

2. EUR/USD

Spot price hovers around 1.1370.

The European Central Bank sent clear hawkish signals, with markets pricing a 95% probability of a 25bp rate hike in September. Christine Lagarde warned that rising energy costs may trigger second-round inflation effects, and disinflation will not proceed smoothly.

Bearish drivers: Persistent weakness in Eurozone manufacturing and higher energy import costs weighing on the trade balance.

Dual opposing forces: ECB hike expectations underpin the Euro, while the US interest rate advantage and global safe-haven flows favouring the US Dollar cap upside. The short-term range stands at 1.1320–1.1440. A sustained break above 1.1450 is required to unlock further upside.

3. USD/JPY

The pair trades sideways at elevated levels, last quoted near 163.60, after hitting a fresh 1986 low of 163.98.

Core contradiction: The substantial US-Japan interest rate differential continues to dominate market moves, with carry trades suppressing the Yen.

Japan’s Minister of Finance has issued repeated verbal warnings, stating authorities will take decisive exchange rate measures when necessary. However, sustained verbal intervention without actual market operations has diminished market confidence in potential intervention.

Japan’s June core CPI rebounded to 1.6% year-on-year. Markets expect the Bank of Japan to deliver another 25bp hike as early as October. The BoJ is widely expected to hold the benchmark rate at 1% this week. Investors will closely watch Governor Kazuo Ueda’s remarks for clues on future tightening.

Key observation: Explicit hawkish signals from the central bank could trigger a corrective pullback in USD/JPY; without clear hawkish messaging, downward pressure on the Yen will persist. Near-term support: 162.80; resistance: 164.00.

4. GBP/USD

Spot price sits around 1.3310.

The Bank of England maintains its benchmark rate at 3.75%, higher than the ECB, offering interest rate support. Sticky services inflation persists domestically, yet political uncertainty and sluggish economic growth cap bullish momentum for Sterling.

The Pound has edged lower recently amid widespread investor caution. Near-term resistance: 1.3380; support: 1.3250. Going forward, focus will rest on the divergence in policy expectations between the Fed and the BoE.

5. AUD/USD & NZD/USD

AUD/USD trades near 0.6970. Strong Australian employment data keeps the possibility of another RBA rate hike on the table. Nevertheless, commodity currencies are highly sensitive to risk sentiment, international oil prices and commodity cycles, and a resilient US Dollar limits recovery potential.

The Kiwi moves in tandem with risk appetite, while expectations for China’s domestic demand shape its medium-to-long-term outlook. Both commodity currencies remain range-bound with no clear directional catalyst.

6. USD/CAD

As an oil-linked currency, the Canadian Dollar moves closely with crude prices. Lower oil prices erode CAD support; volatile Canadian inflation data has delayed market expectations for Bank of Canada rate cuts. A renewed rally in oil prices would likely lift the Loonie.

III. RMB Exchange Rate News

Zou Lan, Deputy Governor of the People’s Bank of China (PBOC), recently stated that the RMB exchange rate will maintain two-way fluctuations. The PBOC will preserve exchange rate flexibility, keep the RMB broadly stable at a reasonable and balanced level, and closely monitor external shocks stemming from geopolitical risks and overseas central bank policies.

On the policy front, six major state-owned commercial banks have launched direct offshore RMB trading mechanisms, connecting onshore and offshore capital pools. This helps narrow the onshore-offshore spread, stabilise offshore market expectations and guard against excessive short-term exchange rate swings.

Market performance: Onshore CNY and offshore CNH fluctuate around 6.8. Externally, Federal Reserve policy and US Dollar strength constitute the primary external drivers of short-term RMB volatility; domestically, the pace of economic recovery and import & export data provide fundamental support.

Medium-to-long-term institutional views: A persistent current account surplus forms fundamental support. Still, swings in the US Dollar and shifts in risk sentiment will trigger periodic two-way volatility, and there exists no basis for sharp unilateral appreciation or depreciation.

IV. Latest Global Payment Currency Data (SWIFT June Statistics)

The US Dollar’s share of global payments fell to 50.10%, a two-year low; Euro accounts for 21.88%; British Pound 6.71%; Japanese Yen 3.66%. The RMB’s payment share rose to 3.10%, returning to fifth place globally, reflecting steadily rising activity in cross-border RMB settlements.

V. Key Upcoming Events (Beijing Time)

Evening, July 28: US Weekly Initial Jobless Claims; Federal Reserve Rate Decision & Policy Statement
Early Morning, July 29: Fed Chair Wash Press Conference (the biggest market catalyst this week)
Midday, July 31: Bank of Japan Rate Decision & Kazuo Ueda Press Conference
Ongoing monitoring: Developments in the Middle East and swings in Brent crude prices