USD/FJD Outlook: Likely to decrease as the rate is below its recent average and near recent lows amid pressure from multiple factors.
Key drivers:
• Rate gap: The Federal Reserve is signaling potential rate cuts while the Reserve Bank of Fiji maintains a stable policy, which weighs on the USD.
• Risk/commodities: Oil prices remain volatile, negatively impacting the USD as geopolitical tensions affect market confidence.
• One macro factor: The upcoming US labor market data could further influence expectations around Fed easing, leading to more USD weakness.
Range: The USD/FJD is likely to drift within its recent range, as it is already trading near the lower end of this spectrum.
What could change it:
• Upside risk: A stronger-than-expected US labor report may boost the USD and shift the outlook.
• Downside risk: Continued geopolitical tensions could lead to a sharper decline in the USD against the FJD.