USD/FJD Outlook:
The USD/FJD is below its recent average and near recent lows, likely to decrease as uncertainties around U.S. tariffs exert pressure on the US Dollar.
Key drivers:
- Rate gap: The Federal Reserve's consistent interest rate policy contrasts with the Reserve Bank of Fiji's approach, impacting the USD's competitiveness.
- Risk/commodities: The recent downturn in global oil prices may affect the FJD, as commodity prices influence Fiji's economic activity and trade balance.
- One macro factor: Fiji's forecast of 3% economic growth for 2026, driven by increased visitor arrivals, supports a stable FJD outlook amidst volatile USD conditions.
Range:
The USD/FJD is likely to drift within its recent range, with potential tests of the lower extremes.
What could change it:
- Upside risk: A surprising development in U.S. economic data could shift focus back to the USD.
- Downside risk: Continued tariff conflicts and trade uncertainties may further weaken the USD against the FJD.
