The market continued to bolster the dollar’s recovery following Treasury Secretary Bessent’s remarks to the audience, emphasizing that the US consistently advocates for a strong dollar. However, the market appeared skeptical of the administration’s stance, which seemed to provide verbal support for Japan at the end of last week. The president expressed a lack of concern regarding the dollar’s significant sell-off and continued to advocate for lower interest rates. Despite some fluctuations following the predictable FOMC meeting and a rather uneventful press conference, the earlier upward dollar correction momentum had nearly vanished by the end of the trading session. Initial follow-through selling deepened the dollar’s losses; however, it has since recovered and is now relatively stable in late European morning trading. The intraday momentum indicators are currently overextended, and the North American market has demonstrated a tendency to sell the dollar following the FOMC meeting. Currently, the US “armada” is gathering near Iran, contributing to immediate geopolitical tensions that have driven oil prices to four-month highs.

The euro continued its decline following the Federal Reserve’s announcement and its decision to maintain current policy settings. The euro momentarily dipped under $1.19, attracting the attention of buyers. It rebounded slightly to just above $1.1950 prior to the North American market close. It approached nearly $1.20 during the Asia Pacific session but retraced slightly to just below $1.1940 in Europe. Intraday momentum indicators are currently at elevated levels as the North American session approaches. The dollar briefly exceeded JPY154.00 following the FOMC announcement before retreating to approximately JPY153.20. It declined to approximately JPY152.75 during today’s local session. The recent low observed over the last two sessions stands at JPY152.10-20. The dollar regained strength in Europe, nearing JPY153.50. Following a peak of approximately $1.3850 during early Asia Pacific trading yesterday, sterling declined to around $1.3750 in the North American morning session, as the dollar strengthened in response to Bessent’s remarks.

The asset revisited the low following the FOMC statement and subsequently bounced back to approximately $1.3810. Follow-through buying propelled it back to nearly $1.3850 today, where it encountered resistance. The price has reached approximately $1.3780 in Europe, indicating that intraday momentum indicators are currently overextended. The U.S. dollar declined to nearly CAD1.3535 during the North American morning yesterday, marking a slight dip of a few hundredths of a Canadian cent below last year’s low. The currency rebounded to nearly CAD1.3610 before concluding slightly above CAD1.3555. The US dollar declined to CAD1.3510 during the Asia Pacific session, but subsequently rebounded, returning to the CAD1.3560 range. There could be some additional potential for growth, but it is expected to be depleted prior to reaching CAD1.3580. The Australian dollar fluctuated within the range of approximately $0.6980 to $0.7000 during the majority of the North American session. Following the Fed’s actions, the US dollar weakened, allowing the Australian dollar to rise to nearly $0.7045 in late trading. It approached approximately $0.7095 during the Asia Pacific session before reversing direction and moving back toward the lows observed near $0.7020.

The robustness of the Swiss franc could present challenges for the central bank. The franc’s position at its lowest against the dollar in over ten years raises concerns; however, officials appear to prioritize its performance against the euro. The euro declined to its lowest point since 2015 against the Swiss franc yesterday, approaching CHF0.9155. The Swiss deposit rate stands at zero, while the yield on the two-year note is currently at minus 20 basis points. The dollar and euro have maintained yesterday’s lows thus far today.