USD/FJD Outlook:
Likely to decrease, as the rate is below its recent average and pressured by shifting market dynamics.
Key drivers:
- Rate gap: The U.S. Federal Reserve's decision to hold interest rates steady contrasts with Fiji's low-rate environment, potentially weakening the USD against the FJD.
- Risk/commodities: Recent fluctuations in global commodities have affected broader market confidence, which may indirectly support the FJD as it strengthens in the current environment.
- One macro factor: Global trade tensions, including tariff concerns, create uncertainty that the Reserve Bank of Fiji is closely monitoring, affecting the FJD's stability.
Range:
The USD/FJD rate is likely to drift lower within its recent range, facing challenges as it trends toward the bottom.
What could change it:
- Upside risk: A stronger-than-expected recovery in U.S. economic indicators, such as jobless claims, could boost the USD.
- Downside risk: Continued geopolitical tensions and global shifts towards de-dollarization may further pressure the USD lower.
