30th March to 5th April 2026
The US Dollar reached an 11-month high during the week of March 30 – April 3, 2026, driven by safe-haven demand amid escalating Middle East tensions and rising oil prices. EUR/USD traded at 1.1483 as of March 30, down from recent levels, while USD/JPY surged above 160.00, triggering intervention concerns. GBP/USD broke support levels under pressure from USD strength, though Sterling maintained relative resilience supported by BoE’s hawkish stance versus ECB dovishness. AUD remained one of 2026’s strongest performers on improving Chinese data.
EUR/USD Spot Rate: 1.1483
▼ -0.75% 🔴 Outlook: Bearish | Support: 1.1500 · Resistance: 1.1770
Week in Review
The pair faced selling pressure as Middle East conflict escalated, sending oil and gas prices surging. The 1.1500 level came back into play, reminiscent of November’s support zone. Dollar safe-haven flows dominated despite no fundamental improvement in US economic backdrop.
Key Drivers: USD safe-haven demand from Middle East geopolitical tensions · Rising oil prices creating energy shock for Eurozone · ECB expected to cut rates to 2.00% while Fed holds at 3.50%-3.75%
Forward Outlook
Downside pressure likely to continue if USD/JPY intervention triggers broader dollar weakness, which could buoy EUR/USD higher. The 1.1500 level represents critical support; a break below targets deeper declines. Upside potential exists if BoJ intervenes or geopolitical tensions ease.
GBP/USD Spot Rate: 1.3350
▼ -0.55% 🔵 Outlook: Neutral | Support: 1.3300 · Resistance: 1.3500
Week in Review
Cable broke through support levels as broad dollar strength overwhelmed Sterling’s relative resilience. The pound continues to receive support from BoE’s cautious approach to rate cuts, contrasting sharply with ECB’s accommodative stance. UK GDP data due Friday represents key domestic catalyst.
Key Drivers: BoE maintaining rates at 3.75% versus Fed’s 3.50%-3.75% range · USD safe-haven flows from geopolitical risk premium · Anticipation of UK GDP data showing modest monthly improvement
Forward Outlook
Weaker US CPI could push the pair toward 1.3500, while stronger inflation data risks a move back to 1.3300. The BoE-Fed policy divergence provides fundamental support, though geopolitical developments remain the dominant near-term driver. Sterling’s resilience depends on maintaining growth momentum.
USD/JPY Spot Rate: 160.25
▲ +1.20% 🔴 Outlook: Bearish | Support: 157.50 · Resistance: 162.00
Week in Review
The pair surged above the psychologically significant 160.00 handle, triggering fears of imminent BoJ intervention similar to 2022 episodes. Widening US-Japan rate differentials and rising energy costs pressuring the yen continue to drive momentum. The crowded carry trade unwind risk looms large.
Key Drivers: Significant interest rate differential between US (3.50%-3.75%) and Japan · Rising oil prices widening Japan’s trade deficit · BoJ intervention risk as pair approaches 2022 intervention levels
Forward Outlook
Continued bullish momentum risks triggering BoJ action, which could send the pair spiraling lower and create cascading effects across currency markets. A fast-moving reversal could drive USD weakness broadly. Japan’s trade balance data may provide near-term catalyst for volatility.
AUD/USD Spot Rate: 0.6720
▲ +0.40% 🟢 Outlook: Bullish | Support: 0.6650 · Resistance: 0.6800
Week in Review
The Australian dollar maintained its position as one of 2026’s strongest major currencies, supported by improving Chinese economic data. Commodity price strength and China’s stabilizing economy continue to underpin demand. The pair showed resilience despite broader dollar strength across G10.
Key Drivers: Improving Chinese economic data benefiting Australia’s export outlook · Higher commodity prices supporting resource-linked currency · China trade balance figures providing additional support
Forward Outlook
The AUD outlook remains constructive as long as Chinese data continues to improve and commodity prices hold elevated levels. Further Chinese stimulus or stronger trade numbers could push the pair toward 0.6800. However, escalating geopolitical tensions pose downside risk to risk-sensitive currencies.
EUR/GBP Spot Rate: 0.8605
▼ -0.25% 🔴 Outlook: Bearish | Support: 0.8550 · Resistance: 0.8700
Week in Review
The cross declined as the BoE-ECB policy divergence remained the dominant driver. Markets expect the ECB to cut rates to 2.00% next week while the BoE likely keeps rates unchanged at 3.75%. Sterling’s structural advantage from tighter monetary policy continues to weigh on the euro.
Key Drivers: ECB expected to cut to 2.00% versus BoE holding at 3.75% · BoE’s cautious rate cut approach contrasting with ECB accommodation · UK growth prospects showing modest improvement versus Eurozone stagnation
Forward Outlook
The policy divergence theme should continue supporting Sterling versus the euro through Q2 2026. ECB rate cuts next week will reinforce the narrative. Support at 0.8550 represents a key technical level; a break could accelerate EUR weakness toward 0.8500.
⚠️ Risk Events — Next Week
| Event | Date | Impact | Affected |
|---|---|---|---|
| ECB Interest Rate Decision | April 10, 2026 | high | EUR, EUR/GBP |
| US CPI Inflation Data | April 9, 2026 | high | USD, EUR/USD, GBP/USD |
| UK GDP Release | April 4, 2026 | medium | GBP, GBP/USD, EUR/GBP |
| Japan Trade Balance | April 8, 2026 | medium | JPY, USD/JPY |
| China Trade Balance | April 7, 2026 | medium | AUD, AUD/USD |
Analyst Note
The week’s dominant theme was safe-haven dollar demand driven by Middle East geopolitical escalation and surging energy prices. USD/JPY’s breach of 160.00 represents a critical inflection point – BoJ intervention could trigger violent reversal effects across G10. Central bank policy divergence between BoE and ECB provides the most reliable structural trade setup for the coming weeks.
This report is for informational purposes only and does not constitute financial advice. Published by Elven Financial Research.