EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Gains Ground As Traders Bet On Hawkish Fed

U.S. Dollar

U.S. Dollar Index gains ground despite the disappointing CB Consumer Confidence report. The report indicated that CB Consumer Confidence declined from 103.1 (revised from 104.7) in March to 97.0 in April, compared to analyst consensus of 104.00. Treasury yields are moving higher, providing support to the American currency ahead of the Fed Interest Rate Decision, which will be released tomorrow.

In case U.S. Dollar Index stays above the 106.00 level, it will head towards the recent highs at 106.50.

EUR/USD

EUR/USD is moving lower as traders react to the flash readings of the Euro Area inflation reports. Euro Area Inflation Rate remained unchanged at 2.4% in April, while Euro Area Core Inflation Rate declined from 2.9% to 2.7%.

In case EUR/USD settles below the 50 MA at 1.0688, it will move towards the nearest support level, which is located in the 1.0600 – 1.0625 range.

GBP/USD

GBP/USD pulls back as traders bet that Fed will be more hawkish than BoE in the upcoming months.

A move below the 1.2500 level will open the way to the test of the support at 1.2425 – 1.2450.

USD/CAD

USD/CAD gains ground amid a strong pullback in commodity markets. Traders are worried that Fed Chair Jerome Powell would send a hawkish signal, which would be bearish for commodities and commodity-related currencies.

If USD/CAD settles above the 1.3750 level, it will move towards the nearest resistance level at 1.3785 – 1.3800.

USD/JPY

USD/JPY rebounds after the pullback that was triggered by BoJ intervention. Japan’s central bank has shown that it would try to defend the 160.00 level. However, the Japanese yen remains fundamentally weak, so bulls may try to test the key 160.00 level again.

In case USD/JPY climbs above the 158.00 level, it will head towards the important resistance at 159.50 – 160.00.

For a look at all of today’s economic events, check out our economic calendar.