RBC 1-Three month outlook for main currencies

US Greenback (USD)

• Rangebound with opposing drivers: Fed cuts argue for weak point, robust US equities entice inflows.

• Seemingly stays contained in close to time period, with weak point rising later in This fall.

Euro (EUR)

• Lack of funding enchantment to date; equities and charges underperformed US.

• German stimulus and Fed cuts vs ECB pause might help EUR/USD.

• Dangers each methods, however skew is mildly constructive.

Japanese Yen (JPY)

• RBC maintains bullish name; USD/JPY anticipated beneath 140 by year-end.

• Current weak point blamed on July-specific components (elections, tariffs, carry).

• Fee differentials transferring in JPY’s favor, BOJ regular, Fed easing.

Sterling (GBP)

• Undervalued vs EUR, SEK, CHF; GBP/CHF has strongest short-term upside.

• BoE cautious on cuts; yet another reduce anticipated this 12 months.

• Engaging for carry, particularly vs CHF; restricted US tariff publicity helps.

Swiss Franc (CHF)

• Weak point delayed as SNB cautious on detrimental charges.

• Inflation weak however edging up; tariffs from US a giant danger (39% on exports).

• Weak to bouts of weak point close to time period.

Canadian Greenback (CAD)

• USD/CAD caught in 1.3550–1.3900 vary; RBC retains 1.38 Q3 goal.

• Rallies above 1.38 seen as promoting alternatives.

• Solely large Fed or BoC surprises might break the vary.

Australian Greenback (AUD)

• Forecasts revised greater; AUD/USD to zero.64 end-2025.

• Supported by USD weak point, easing US-China commerce tensions, and agency commodity costs.

New Zealand Greenback (NZD)

• Underperforming; forecast revised to zero.58 end-2025.

• Weak economic system and rising unemployment weigh, regardless of excessive charges.

• Agriculture sector advantages from weaker forex.

This text was written by Arno V Venter at investinglive.com.