Global FX: Broader impacts from the dollar bid

Macroeconomic shifts and currency strategies dominate the current market landscape, with the US dollar maintaining a bullish outlook driven by resilient growth and persistent core inflation. While European data remains soft, the Norwegian Krone benefits from hawkish central bank expectations and favorable rate spreads. Sterling shows surprising resilience, supported by carry trade dynamics and a diminishing political risk premium despite recent weak economic indicators. In Asia, the Australian dollar faces a sentiment shift as the RBA’s hiking cycle appears to reach its conclusion, while the Chinese Yuan remains constructive despite concerns over dividend-related outflows. Regarding the Japanese Yen, intervention risks intensify as the currency approaches the 160 level; however, such measures likely offer only temporary support without a broader decline in the US dollar, as fundamental drivers continue to dictate market trends.