The USD/FJD bias is range-bound as the pair trades near its 90-day average and sits in the middle of the recent 3-month range.
Key drivers:
- Rate gap: The Federal Reserve's expected interest rate cuts may weigh on the USD, while the Reserve Bank of Fiji sees stable growth with a revised economic outlook.
- Risk/commodities: With oil prices remaining volatile, the USD could be affected as rising energy costs influence inflation and economic health projections in the US.
- One macro factor: The upcoming general election in Fiji could drive changes in economic policies, impacting investor confidence and the FJD.
Range: The USD/FJD is likely to oscillate within its recent range, holding steady without major breakouts in the near term.
What could change it:
- Upside risk: An unexpected strong US labor report could boost the USD.
- Downside risk: A dovish tone from Federal Reserve officials may weaken the USD.