Global Markets Await Fed as Dollar Steadies (05.07.2025)

Euro Slips to $1.1338 Ahead of Fed Decision

The euro fell 0.2% to $1.1338 on Wednesday, retreating from recent gains amid political developments in Germany. Although the U.S. dollar remained under pressure due to global outflows and trade-related uncertainty, the euro lacked clear direction as markets awaited the Federal Reserve’s policy decision. With rates likely to remain unchanged, uncertainty around future cuts and U.S. inflation kept EUR/USD range-bound.

Resistance levels are seen at 1.1460, then 1.1580 and 1.1680, while support rests at 1.1260, followed by 1.1200 and 1.1150.

JPY Falls After Three-Day Rally

The Japanese yen slipped beyond 143 per dollar on Wednesday, ending a three-day advance, as optimism over upcoming U.S.-China trade talks reduced safe-haven demand. Sentiment was further supported by China’s rate cuts and stronger PMI figures for Japanese services. Traders also kept an eye on U.S.-Japan trade discussions, while the Bank of Japan’s decision to hold rates and lower growth and inflation forecasts indicated limited prospects for near-term rate hikes.

Resistance is located at 145.90, followed by 146.75 and 149.80. On the downside, support levels are at 139.70, then 137.00 and 135.00.

Gold Falls Below $3,380 on Trade Talk Hopes

Gold fell below $3,380 per ounce on Wednesday, ending a two-day rally, as news of an upcoming US-China meeting reduced safe-haven demand. The talks aim to ease trade tensions after last month’s tariff hikes by both nations. Investors now await the Federal Reserve’s policy decision and comments from Chair Powell, with rates expected to remain unchanged despite political pressure for cuts.

Resistance is expected at $3,460, then $3,500 and $3,550. Support stands at $3,350, followed by $3,300 and $3,265.

GBP Awaits Rate Cut and Forecasts

The British pound stayed near $1.335 as traders awaited the Bank of England’s expected interest rate cut of 25 basis points to 4.25 percent and the release of updated economic forecasts. Some analysts believe the central bank may adopt a more aggressive easing approach due to rising global risks, including new tariffs announced by President Trump. However, the United Kingdom’s exposure to U.S. tariffs remains limited. A recently signed trade agreement with India is projected to contribute £4.8 billion to the economy annually by 2040.

If GBP/USD breaks above 1.3430, the next resistance levels are 1.3500 and 1.3550. Support levels are at 1.3200, followed by 1.3050 and 1.2960.

Silver Slips to $33 on Trade Optimism

Silver declined 0.4% to $33 on Wednesday as improving sentiment around U.S.-China trade talks reduced demand for safe-haven assets, following a similar move in gold. However, the broader outlook for silver remains underpinned by expectations of U.S. interest rate cuts, which tend to favor non-yielding assets. Markets are now watching the Federal Reserve’s policy decision and comments from Chair Powell for clues on future rate adjustments.

The first resistance is seen at $33.80, with higher levels at $34.20 and $34.85 if momentum builds. Support begins at $32.00, followed by $31.40 and $30.20.