News & Analysis / Analysis / Inflation Data and Fed Verdict Could Set Dollar's Summer Trend

Inflation Data and Fed Verdict Could Set Dollar's Summer Trend

FXOpen

The US currency is gearing up for the most important trading session of the current week, and possibly even the month. Today, the US Consumer Price Index (CPI) data for May will be released. Additionally, the Federal Reserve (Fed) has a meeting scheduled today where the base interest rate will be announced, along with the regulator's dot plot forecast for the rest of the year. Considering that last Friday's employment data exceeded forecasts, many investors and experts (according to an FT-Chicago Booth survey) believe that:

  • The Fed will reduce rates by only a quarter of a percentage point this year;
  • Instead of three cuts, economists and traders are pricing in up to two rate cuts by the end of the year.

Naturally, such hawkish market expectations are likely to support the strengthening of the US currency. However, it should be noted that the dollar is currently at medium- and long-term highs, and the likelihood of a pullback and the formation of reversal patterns is quite high.

USD/JPY

Following the technical analysis of the USD/JPY pair:

  • There is a high probability of testing the May high of this year at 157.70;
  • Consolidation above 157.70 could contribute to a renewed rise towards the psychological level of 160.00;
  • A rebound or a false breakout at 157.70 could contribute to a return to 155.60-154.80.

EUR/USD

The EUR/USD currency pair is under double pressure. On the one hand, the dollar is strengthening after good labour market data in the US, and on the other hand, there is political uncertainty following the European Parliament elections, the results of which were published at the beginning of the week. Where might the pair head in the upcoming trading sessions?

  • In case of weak data for the dollar, the price could attempt to close the "price gap" of Monday at 1.0800;
  • A break of the important support level at 1.0710 could contribute to a resumption of the downward movement towards 1.0600.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Stay ahead of the market!

Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.

forex

Instrument
Live ECN bid
Live ECN ask
Action
EURUSD
1.09191
1.09192
Trade
GBPUSD
1.29850
1.29853
Trade
AUDUSD
0.63829
0.63829
Trade
USDJPY
149.357
149.364
Trade
USDCAD
1.42949
1.42959
Trade
More
Forex Trading with FXOpen

Forex Trading with FXOpen

Experience ECN technology for deep liquidity and light-speed trade execution

  • Access over 50 markets
  • Trade with spreads from 0.0 pips
  • Take advantage of commissions from $1.50/lot
Learn more

Latest articles

Market Insights with Gary Thomson: Canada’s Inflation, Fed and BoE Interest Rates, Earnings Reports
Financial Market News

Market Insights with Gary Thomson: Canada’s Inflation, Fed and BoE Interest Rates, Earnings Reports

In this video, we’ll explore the key economic events, market trends, and corporate news shaping the financial landscape. Get ready for expert insights into forex, commodities, and stocks to help you navigate the week ahead. Let’s dive in!

Indices

S&P 500 Analysis: How Long Could the Stock Market Correction Last?

Six days ago, we noted that the Nasdaq 100 had entered a correction phase. Now, the S&P 500 (US SPX 500 mini on FXOpen) has followed suit, closing more than 10% below its 19 February peak on Thursday,

Shares

Spotify (SPOT) Shares Rise by Nearly 7%

According to the stock chart of music streaming giant Spotify (SPOT), the share price:
→ Increased by almost 7% by the end of trading on Friday.
→ Has surged approximately 28% since the start of 2025—one of the strongest performances in