WEEKLY CURRENCY OUTLOOK

May 26, 2025 CurrenC
  • AU CPI & US Core PCE Index are the headliners for this week!
  • AU CPI expected to fall to 2.3% y/y (prev 2.4%) and PCE index expected to rise 0.1% (prev 0%).
  • AUDUSD to continue consolidating with bullish bias, pivoting between 0.6424 – 0.6532.
    • AUDUSD is likely to trade within the above range this week, with the lack of high-impact USD data.

    • The RBA cut the cash rate by 0.25% to 3.85% last week.

    • AU CPI is expected to be at 2.3% y/y this week (compared to 2.4% last week), which is +ve for the next rate cut but -ve for the AUDUSD.

    • Another rate cut is expected around Q3 this year.

    • Due to the lack of USD data this week, AU will be influenced by the CPI release and local data. There might be news of further tariffs being implemented, which could weaken the USD.

    • Core PCE index expected @ 0.1% m/m (prev 0%), although unlikely to move the needle. There is also a bank holiday on Monday in the US.

    • AUDUSD remaining bullish!

    Economic Calendar: Mon 26th May 2025 – Friday 30th May 2025 (High Impact) (AU/US)
    Day Time(AEST) Event Country Forecast Previous
    Mon All Day Bank Holiday US N/A N/A
    Wed 11:30am CPI y/y AU 2.3% 2.4%
    Thur 4:00am FOMC Meeting Minutes US N/A N/A
      10:30pm Prelim GDP q/q US -0.3% -0.3%
        Unemployment Claims US 229K 227K
    Fri 10:30pm Core PCE Price Index m/m US 0.1% 0.0%

    Source: forexfactory.com

CurrenCWEEKLY CURRENCY OUTLOOK