The USD is higher vs the major currencies to start the US trading day

The US dollars higher to kickstart the US session. The biggest gains are versus the commodity currencies with the AUD (+1.09%), CAD (+0.63%), and NZD (+0.61%). The top three – the EURUSD, USDJPY and GBPUSD – are also showing dollar strength with the greenbacks gains versus the JPY (0.55%) and the EUR (0.48%) outpacing the gain vs the GBP (0.22%).

US yields are higher with the shorter end going back declines from yesterday. The two-year is up 3.2 basis points at 3.917%. The 10 year is also higher by 1.4 basis points giving the USD support.

Focus on impact of tariffs is also weighing on the “other currencies” with ECB’s Nage saying that if tariffs materialize and August, every session in Germany in 2025 cannot be ruled out and that is expectations of 0.7% gain in 2026 could be eaten up by tariffs if they are imposed.

In the video above I take a look at the technicals that are driving the three major currency pairs – the EURUSD, USDJPY and the GBPUSD. What are the traders bias, the risks and the targets that need to be eyed in your trading today (and why).

In other developments overnight:

New York Fed president Williams spoke and said the current policy is appropriate and allows the Fed time to analyze data. In summary

Fed Policy & Economic Outlook

• The Fed needs more data before deciding next policy moves.

• Current modestly restrictive monetary policy is appropriate and gives the Fed time to analyze.

• The Fed is mission-driven and will not respond to political commentary.

Inflation & Tariffs

• Inflation has moderated unevenly, especially due to housing-related factors.

• Without tariffs, inflation would be nearing 2%.

• Tariffs are expected to add ~1 percentage point to inflation from late 2025 into 2026.

• So far, tariff impacts are modest, but they are expected to grow over time.

• Inflation in June: 2.5% headline, 2.75% core.

• Projected inflation path:

Labor Market & Growth

• The labor market is solid but slowing, with both job growth and labor supply easing.

• Unemployment projected to rise to 4.5% by year-end.

• Growth is expected around 1% for 2025.

• Economy is being impacted by heightened uncertainty.

Other Key Points

• Disinflation process is ongoing, but the underlying trend remains in place.

• Financial conditions are still supportive of growth.

• Fed policy is expected to moderately weaken the labor market.