USD/XPF Outlook:
The USD/XPF rate is likely to move sideways as it currently sits below its recent average, despite being near its recent highs. Mixed signals from the US jobs data and anticipated declines in durable goods orders create uncertainty about the dollar's strength.
Key drivers:
• Rate gap: The Federal Reserve's current monetary policy is prioritizing interest rate stabilization, in contrast to the European Central Bank's influence on the CFP franc.
• Risk/commodities: The recent retreat in oil prices could impact market risk appetite, affecting the demand for currencies influenced by commodity prices.
• One macro factor: There is an expected contraction in US durable goods orders, which could weigh on the USD in the near term.
Range:
The USD/XPF is likely to hold within its recent trading range, as ongoing economic data will influence its movement.
What could change it:
• Upside risk: Stronger-than-expected US labor market data could support a more robust dollar.
• Downside risk: Continued declines in US economic indicators could pressure the USD further.
