The dollar stayed on the back foot this week even as the Federal Reserve held rates steady, with traders unconvinced by the central bank’s hawkish tone. EUR/USD firmed to 1.1537 while GBP/USD pushed toward the 1.3480 area on continued momentum. USD/JPY slipped below 157.00 amid renewed chatter of coordinated US-Japan intervention. Broader risk appetite and a softer dollar narrative dominated positioning into the new week.
EUR/USD Spot Rate: 1.1537
▲ +0.65% 🟢 Outlook: Bullish | Support: 1.1450 · Resistance: 1.1620
Week in Review
EUR/USD climbed through the week as the Fed’s steady-rate decision failed to spark a dollar rally, with markets fading the hawkish guidance. The pair held above 1.15 for most sessions, supported by resilient eurozone data.
Key Drivers: Fed held rates, hawkish tone unconvincing · Broad dollar weakness · Firm eurozone PMI data
Forward Outlook
EUR/USD looks set to test the 1.16 handle if dollar softness persists, with ECB commentary this week providing the next catalyst. A break below 1.145 would signal a stall in the uptrend.
GBP/USD Spot Rate: 1.3433
▼ -0.40% 🔵 Outlook: Neutral | Support: 1.3300 · Resistance: 1.4000
Week in Review
Cable slipped modestly on the day but remains near multi-month highs after a strong run, with momentum still favoring further tests of the 1.40 region ahead of Thursday’s BoE decision.
Key Drivers: BoE meeting August 7 · August seasonality historically bearish for GBP · Dollar weakness offsetting seasonal drag
Forward Outlook
The path toward 1.40 remains open if the BoE strikes a less dovish tone than expected, though seasonal headwinds and profit-taking could cap gains near-term.
USD/JPY Spot Rate: 156.98
▼ -0.27% 🔵 Outlook: Neutral | Support: 155.00 · Resistance: 158.50
Week in Review
USD/JPY eased off recent highs as speculation mounted over coordinated US-Japan FX intervention, injecting fresh volatility into the pair after an extended yen-weakness trend.
Key Drivers: Intervention speculation · BOJ policy divergence with Fed · Broad dollar softness
Forward Outlook
Further downside toward 155.00 is possible if intervention rhetoric intensifies, though the underlying yield differential still favors dollar strength on any relief rally.
AUD/USD Spot Rate: 0.7002
▼ -0.33% 🔵 Outlook: Neutral | Support: 0.6950 · Resistance: 0.7080
Week in Review
The Aussie dipped slightly, pressured by softer risk sentiment and commodity price wobbles, but held the 0.70 handle despite the pullback.
Key Drivers: Commodity price softness · China demand concerns · RBA rate path uncertainty
Forward Outlook
AUD/USD should stay range-bound near 0.70 barring a fresh China stimulus surprise or a sharper US dollar move; a hold above 0.695 keeps the bias constructive.
EUR/GBP Spot Rate: 0.8568
▲ +0.20% 🔵 Outlook: Neutral | Support: 0.8500 · Resistance: 0.8650
Week in Review
EUR/GBP edged higher as euro strength outpaced sterling’s own gains against the dollar, with the cross grinding toward the upper end of its recent range.
Key Drivers: Relative euro strength · BoE decision risk for sterling · Cross-flow rebalancing
Forward Outlook
A move above 0.8600 would open the door to 0.8650, though a hawkish BoE surprise this week could quickly reverse the cross lower.
⚠️ Risk Events — Next Week
| Event | Date | Impact | Affected |
|---|---|---|---|
| ISM Services PMI | August 5, 2026 | medium | USD |
| Bank of England Rate Decision | August 7, 2026 | high | GBP |
| Weekly Initial Jobless Claims | August 7, 2026 | medium | USD |
| Eurozone Retail Sales & German Factory Orders | August 6, 2026 | low | EUR |
Analyst Note
The dollar’s inability to rally on a hawkish Fed hold is the week’s key tell — positioning looks stretched short-dollar, but conviction remains with sellers into the BoE decision. Watch for intervention headlines out of Tokyo as the wildcard risk for USD/JPY.
This report is for informational purposes only and does not constitute financial advice. Published by Elven Financial Research.
