Bias: The QAR/USD is bullish-to-range-bound, as it currently sits above the 90-day average and in the upper half of the 3-month range.
Key drivers:
• Rate gap: The Qatar Central Bank's interest rate policy is aligned with that of the Federal Reserve, maintaining the peg while contributing to stability.
• Risk/commodities: Oil trends continue to influence economic conditions in both regions, with any volatility impacting the demand for USD and QAR.
• Macro factor: Recent US labor market data, showing a drop in unemployment, has bolstered USD demand, which may affect the broader exchange dynamics.
Range: QAR/USD is likely to hold within the recent 3-month range, experiencing minor fluctuations as each currency's economic factors play out.
What could change it:
• Upside risk: Further positive GDP forecasts for Qatar could strengthen the QAR against the USD.
• Downside risk: Any dovish comments from Federal Reserve officials regarding interest rate adjustments could weaken the USD, impacting the exchange rate.