USD/WST Outlook:
Bearish, as the USD is below its recent average and near recent lows, facing pressure from various economic factors.
Key drivers:
• Rate gap: The Federal Reserve has paused interest rate cuts, maintaining a more cautious stance compared to the Central Bank of Samoa, which is managing high excess liquidity.
• Global economic trends: A decline in USD demand is influenced by geopolitical tensions and the growing trend of de-dollarization among BRICS nations, which may weaken USD further.
• Samoan growth: Forecasts indicate a 3.2% economic growth in Samoa, driven by increased investments and government spending, which supports the WST.
Range:
The USD/WST is likely to drift within its recent range, with limited chances for significant movement as market forces balance.
What could change it:
• Upside risk: A notably strong jobs report could bolster USD demand and strengthen its position.
• Downside risk: Continued geopolitical tensions or further declines in USD demand could push the exchange rate lower.
